BlackBerry announced Monday that it has agreed to be acquired by Fairfax Financial Holdings Limited, a Toronto-based financial holding company, for $4.7 billion. BlackBerry announced Monday that it has agreed to be acquired by Fairfax Financial Holdings Limited, a Toronto-based
BlackBerry announced Monday that it has agreed to be acquired by Fairfax Financial Holdings Limited, a Toronto-based financial holding company, for $4.7 billion.
The company said that it has signed a letter of intent agreement with Fairfax, which owns about 10 percent of BlackBerry’s common shares.
The deal was recommended by a special committee BlackBerry formed last month after disappointing sales of its newest handsets.
Last week, the company announced it will lay off 4,500 employees, about 40 percent of its workforce, and posted nearly $1 billion in losses in its second quarter.
The company’s special committee said that it will consider alternative offers to the Fairfax consortium proposal during what is called a “go-shop process.”
“Importantly, the go-shop process provides an opportunity to determine if there are alternatives superior to the present proposal from the Fairfax consortium,” Barbara Stymiest, the chair of BlackBerry’s board of directors, said in a statement.
The Wall Street Journal reported that BlackBerry co-founder and former co-chief executive Mike Lazaridis has reached out to private equity firms to construct a possible bid of his own.
If the Fairfax deal is approved by shareholders, it would take the company private, eliminating shareholder pressure as the company attempts to refocus on business and government consumers, and slim down its device line.
In a statement, Fairfax chairman and chief executive Prem Watsa said: “We believe this transaction will open an exciting new private chapter for BlackBerry, its customers, carriers and employees. We can deliver immediate value to shareholders, while we continue the execution of a long-term strategy in a private company with a focus on delivering superior and secure enterprise solutions to BlackBerry customers around the world.”
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