In a surprise announcement, smartphone manufacturer BlackBerry had entered into an agreement to go private through a USD4.7 billion deal put together by its largest shareholder. This would allow the Canadian technology firm to regroup away from prying eyes after years of dismal fortunes and slumping market share.
The offer pegs each share at USD9 made by a consortium led by property and casualty insurer Fairfax Financial Holdings Ltd. It would be set the floor for counteroffers which will emerge for BlackBerry. The company has the 'for sale' sign since August of this year.
To many analysts, Fairfax CEO Prem Watsa, as an investor, is often described as the Canadian version of Warren Buffett, as both take the long term view for every investment done.
The shares of BlackBerry had an all time peak of USD148 last June 2008. At this time, the device of the Canadian firm was the top choice for bankers, politicians and lawyers. Upon the announcement of the said bid, the stock closed below the offer price made by Fairfax, where at Nasdaq the share price was at USD8,82. This only indicates that the market has a lack of faith in the emergence of other bids to compete with the Fairfax bid.
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