Former BlackBerry (NASDAQ:BBRY) co-CEO Mike Lazaridis is considering mounting a bid to take the company private in conjunction with several private equity firms, according to multiple reports. The reports come on the heels of BlackBerry's disclosure on Friday that it will cut 4,500 jobs--around 40 percent of its workforce--and post a nearly $1 billion loss for its most recent quarter, mainly due to unsold BlackBerry 10 smartphone inventory.
The reports, in both the Wall Street Journal and New York Times, which cited unnamed sources, said Lazaridis, who co-founded BlackBerry in 1984, has separately approached the Blackstone Group and the Carlyle Group about making an offer. However, the talks are preliminary and might not result in any deal.
BlackBerry declined to comment, according to the reports, and Lazaridis could not be reached for comment. Blackstone and Carlyle declined to comment, according to the Times.
Lazaridis and former co-CEO Jim Balsillie stepped down in 2012 amid shareholder unrest about the progress of the company, ceding the reins to Thorsten Heins, who has been with BlackBerry since 2007. Although Balsillie has sold his BlackBerry stock, as the Times notes, Lazaridis remains one of the company's largest individual shareholders, which could help in any effort to take the company private.
The company said on Friday that the special committee of its board continues to evaluate its strategic options, which include a possible sale of the company. Recently the Wall Street Journal reported that BlackBerry is hoping to wrap up a sales process by November. A handful of private equity firms and other potential bidders are circling BlackBerry, but interest is tepid and some buyers are expressing interest in parts of its business rather than the whole company, Reuters recently reported
BlackBerry said Friday that it expects revenue in its fiscal second quarter of $1.6 billion, about half of what analysts had been expecting. The company also signaled that it will move away from focusing on the consumer devices market, and more on the kind of customers that gave it its start: enterprise users and "prosumers." However, analysts questioned whether that strategy is a case of too little, too late.
The company remains the leader in mobile device security and management, spokeswoman Kara Yi told the Journal. "BlackBerry is much more than a device company," she added.
"It's the end of an era: BlackBerry as we knew it is over," BGC Partners analyst Colin Gillis told Bloomberg. "They're refocusing on a much smaller niche enterprise-focused company and that's a reasonable strategy for them."
"Perception is nine tenths of reality and if customer and supplier confidence continues to fall it doesn't matter how much cash they have on the balance sheet," GMP Securities analyst Deepak Kaushal told Reuters. "Things could get worse."
Meanwhile, BlackBerry said it plans to sell its entire fleet of corporate jets given its financial weaknesses, including one used Bombardier Global Express jet it bought in July.
- see this NYT article
- see this WSJ blog post (sub. req.)
- see this Bloomberg article
- see this Reuters article
- see this WSJ article (sub. req.)
- see this separate WSJ article (sub. req.)
- see this AllThingsD article
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