Blackberry was due to announce it’s second quarter results via a conference call this morning (Friday, September 27, 2013) but cancelled as rumours circulated the troubled smartphone giant was the subject of a tentative buyout bid from its largest shareholder, FairFax Financial Holdings.
Blackberry had already announced the majority of its financial results plus its projections for the third quarter, but broke news of this latest development via a brief statement: “In light of the letter of intent agreement between BlackBerry and Fairfax Financial Holdings Limited that was signed and announced on Monday, September 23, BlackBerry has canceled its second quarter earnings conference call and webcast that had previously been scheduled for Friday, September 27 at 8:00 a.m.”
See you later, innovater
Once a frontrunner in the smartphone market, Blackberry’s unique physical QWERTY keypad and BBM instant messaging service set it apart from its competitors – but that keypad now seems dated as the world has embraced touch screen and the opportunities that creates. The explosion of social media platforms and the fact that many phone tariffs now come with free messages has also been another nail in the company’s coffin.
This has meant companies like Apple and Samsung have left Blackberry in their wake, and even the 4G enabled Blackberry Z10 (below) couldn’t claw back its lost share of the market.
In order to try and save its flagging fortunes, a letter of intent was signed with a consortium led by Fairfax, that would see the company taken in a private deal valued at $4.7billion (roughly £2.9billion).
The deal, which is still subject to due diligence, is expected to be completed by November 4, 2013, if BlackBerry can’t find another buyer before then.
Drop in the market
However, the deal failed to impress the markets as BlackBerry shares dropped to as low as $7.99 – over a dollar less than the bid price of $9 – but has improved slightly and now sits at $8.03
Amazingly, this slight bounce could have been helped by the fact BlackBerry announced losses of $956million (around £598million) in the three months leading up to August 31 and revealed revenue was down by almost half (49%) compared to the first quarter of 2013.
The drop to $1.6billion (about £99billion) was also down 45% year-on-year but was exactly in line with its forecasts and so was met with a feeling of relief on the stock exchange, hence the slight increase in share price.
Have you ever owned a BlackBerry? If so, would you go back? If not, why not? Let us know in the boxes below or on Twitter with the hashtag #ConfCallBB