Activist investor Jaguar Financial Corp. demanded that BlackBerry maker Research In Motion's (NASDAQ:RIMM) board form a committee to explore either selling the company or spinning off the firm's patent portfolio.
Jaguar Financial, a Toronto-based merchant bank that invests in under-performing and undervalued companies, said that a fundamental change at RIM is needed and that the status quo at RIM is unacceptable. Jaguar Financial said four to five of RIM's seven independent directors should establish the committee to explore strategic options.
A RIM spokeswoman did not immediately have a comment.
Jaguar CEO Vic Alboini said his proposal has the backing of other investors, which he declined to name. Collectively, the investors own less than 5 percent of RIM's shares. Jaguar said RIM could maximize shareholder value by monetizing its patents.
RIM has come under increasing pressure this year from investors and analysts worried about its strategic direction. The company's share price has fallen 48 percent this year, and it is losing market share in the U.S. to Apple's (NASDAQ:AAPL) iPhone and phones running Google's (NASDAQ:GOOG) Android platform. Partly in response, RIM cut 2,000 jobs and promised to streamline its operations.
RIM is in the midst of a transition to smartphones running QNX software, which powers RIM's PlayBook tablet, but those devices will not reach the market until early 2012. RIM released a handful of new BlackBerry devices in August to help it maintain market share while it completes the transition. The devices, which are available at all four Tier 1 operators, received mixed reviews; reviewers said the gadgets were solid BlackBerry devices but were "too little, too late" in the smartphone race.
Earlier this year RIM fended off another power play by an activist investor, Northwest & Ethical Investments, which proposed splitting the roles of co-CEO and co-chairman, currently held by Jim Balsillie and Mike Lazaridis. RIM said it will set up a committee of independent directors to study whether longtime co-CEOs Balsillie and Lazaridis should also lead the board as co-chairmen.
For more:
- see this release
- see this Bloomberg article
- see this Globe and Mail article
- see this Financial Post article
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