[W Hoa]

Here's why Good Technology CEO Christy Wyatt says she is selling to Blackberry - Silicon Valley Business Journal

Talks have been going for the past couple of months, she said, adding that it wasn't clear when they began that they would end in a sale.

"When the conversation first started, the deal wasn't intuitive at first," Wyatt said. "But when we sat down and went through the list, we had this 'Aha!' moment when we realized it makes a ton of sense."
The two companies serve the same customers and share a lot of values around security, she said.
"Blackberry has a very deep technology bench in management," she said. "They have a fantastic portfolio in global services which they have been building through a whole series of integrations. They have infrastructure and integration with carriers around the world and a very strong customer base with broad reach and great distribution."

[RLTurn77]

I'm a buyer. Been on the sidelines lately until today. Too many strategic initiatives going on to sit idly by...one of these will eventually be a winner and I don't want to miss the ride. This is almost an all-you-can-eat at these prices

BBM Channel: C002165D3 Tour 9630 > Bold 9650 > Q10 > Playbook > Classic AND Passport SE!!!

I was almost there... order @ $7.29, but just couldn't do it. Nothing to do with BlackBerry. More to do with the overall markets, China, closed Monday. Took a gamble here; could open above 8 Tuesday or drop below 7.

The close wasn't very convincing. Regardless, BlackBerry is a good long... but this volatility is just preventing me from making a move yet (not bbry volatility, the market). Pretty sure I'm not alone though.

Posted via CB10

[awindsr]

[QUOTE=morganplus8;11900734]FINALLY!!!!

I wouldn't want to own MOBL after this announcement.


^^this!
That was my first thought when I heard the news.

Posted via CB10

[pbfan]

I am doubtful good is worth more than 400m since its IPO target is just 100m.

[Corbu]

GOOD:
Some background, from earlier this year...

Good Technology shows improving financials in updated IPO filing - Silicon Valley Business Journal

It has raised more than $200 million in financing since it was founded in 1996. Oak Investment Partners is its biggest shareholder with a 21.5 percent stake, followed by Draper Fisher Jurvetson that holds 11.2 percent. Other investors who own more than 5 percent of the company are Lazard Technology Partners (7.2 percent), Meritech Capital Partners (6.2 percent) and Saints Rustic Canyon (6.0 percent).

Good Technology, Mobile Management And IPO Ambitions

[morganplus8]

I am doubtful good is worth more than 400m since its IPO target is just 100m.

Oh boy ................. they were doing an IPO to rise $ 100 MM bucks which would have represented a small portion of the value of the company. It is said that valuation was to be in the area of $ 800 MM and they were offering only 13% of that amount at the time.

[_dimi_]

I like your diplomacy Morgan!

Posted via CB10

[Corbu]

Live and learn... Live and learn...

We are lucky to be around knowledgeable people willing to share.

[_dimi_]

Attachment 369824

Ok so this is something I like to study! What I'm wondering is this: BlackBerry still had 250 million USD in service revenue (all BES5/BES6/BIS related I assume?) last quarter. Now, what were the percentages related to BES5/6 vs. BIS according to JC in last quarters call? And would the BES5/6 revenue already be in the 'rest of the market' figure or can we safely assume these will convert to BES12 one day? Now, if that happens, and BlackBerry just took Good's piece of the pie. And BlackBerry manages to take another small portion from the 'rest of the market' segment... We put a high margin on this total figure and BlackBerry should be quite profitable!

Seems to me that VMWare is BlackBerry's biggest competitor now. I wonder if they have any more products in their EMM portfolio compared to BlackBerry because that would of course change the situation.

Posted via CB10

[kfh227]

I hate myself for posting this info, but its out there. Sorry!

MKM Partners Cuts Price Target on BlackBerry (BBRY) Following Announced Plans to Acquire Good Technology

Ol manipulation. They need to tank the stock to close their short position.

Posted via CB10

[pbfan]

Oh boy ................. they were doing an IPO to rise $ 100 MM bucks which would have represented a small portion of the value of the company. It is said that valuation was to be in the area of $ 800 MM and they were offering only 13% of that amount at the time.

Thanks for the information. I did not know 100M was 13% of the IPO valuation. But it may be better to compare Good with Mobl, both having similar revenues. Mobl has a market cap of 315M with 107M in cash but Good increased revenue last year much faster than Mobl. I hope JC will make Good profitable soon and make 1+1>2 eventually.

[Superfly_FR]

I like your diplomacy Morgan!

Posted via CB10

That's classy elegant answer backed with solid argumentation.
The kind of answer we ALL learn from.
Hat off !

Posted via CB10

[kadakn01]

Thanks for the information. I did not know 100M was 13% of the IPO valuation. But it may be better to compare Good with Mobl, both having similar revenues. Mobl has a market cap of 315M with 107M in cash but Good increased revenue last year much faster than Mobl. I hope JC will make Good profitable soon and make 1+1>2 eventually.

Also, MOBL raised 100M when they went public last year as well, although their Market cap when calculated at the IPO price was $9 with about 79M shares outstanding or a valuation then of a little over 700M. They sold 11.1M shares at the ipo price of $9 or essentially 100M, that is where they got the capital, the remainder of the shares were sold to institutions and some are held by some of the VC firms that where initial investors. Actually the majority are held by firms like Genesis VC at 12.2M shares, and Storm Venture and Sequoia holding a combined 20M shares as well as a few others, and they had raised about 145M from these VC firms before they went public. What is worth noting is the valuation of that 145M invested has not been a great return given the current mkt cap!
It had a high valuation of almost $13 or just over a 1 Billion at one point and now is worth just over 300M as you stated.
To best sum up what John Chen just did
" Be a liquidity provider when their is no liquidity"
Brilliant Move on his part, and why the cash is such an asset BECAUSE BBRY is cash flow positive! If they were bleeding cash like MOBL, this would not have been possible.

Posted via CB10

[kadakn01]

On a separate note to compare GOOD to MOBL, at least at the company I am referring to. The MOBL actually is the inbox in the iphone and simply requires a pw to unlock the device, while GOOD requires a application to open and then to check emails. I can say the MOBL software is preferred at least for email, and I know some companies that started using GOOD but are beta testing MOBL as an alternative. I think the combo of BBRY and GOOD couldn't have come at a better time to integrate and knock out MOBL at many of these companies still in the "beta" phase with MOBL

Posted via CB10

[bbjdog]

Ol manipulation. They need to tank the stock to close their short position.

Posted via CB10

With the current market conditions it doesn't take much to send the price back down. Once this major market correction is over, we can actual see the market's evaluation of this deal.

Love JC moves and he sure knows how to shop.

Short positions don't need a reason to close, some are in the green and can close anytime they wish. What's that saying, sell on news.

[morganplus8]

Has this one been posted?

BlackBerry?s $425-million Good Technology deal not without concerns - The Globe and Mail

[morganplus8]

Thanks for the information. I did not know 100M was 13% of the IPO valuation. But it may be better to compare Good with Mobl, both having similar revenues. Mobl has a market cap of 315M with 107M in cash but Good increased revenue last year much faster than Mobl. I hope JC will make Good profitable soon and make 1+1>2 eventually.

You are welcome. Just to give you a flavour of how Good Technology has grown over the years .... have a look at their previous financings and acquisitions with the same:

https://www.crunchbase.com/organization/good-technology

As you can see, they have raised about $ 300 MM and acquired a large number of tech companies. These assets still hold value as does their cash. When you look at the market cap, you need to include all of the shares issued over the length of time. BlackBerry was wise to make a purchase at this time as Good needs cash and synergies to cut costs and BB needs internal head count and customers.

I value MOBL at $ 350 MM at the moment and this decreases each quarter by roughly $ 25 MM as they fail to find a buyer. Good brings with it revenues but their growth has stalled this year, whereas MOBL missed on Q revenues 2 quarters ago followed by a strong but lower guided recent quarter. In other words neither of them were setting the world on fire.

What sets Good apart for BlackBerry is their ability to mesh the two companies together and reduce cuts while allowing BlackBerry to up sell and improve margins. The end game is to make Good self sufficient and I think Chen is a master at achieving this. The numbers won't flow to the bottom line any time soon so Chen needs to keep buying up tech revenues to meet his $ 500 MM goal. Superfly pointed out earlier today that BB will see roughly $ 40 MM in Good revenues in FY2016 so he needs to keep looking for value.

The financial advantage for BlackBerry is that they are cash-flow positive and will likely see $ 3.0 B in NET cash for 2016 after this purchase so Chen is working wonders with that money. If you need to see an IPO process with stock based valuation look no further than Facebook. If you need to know more about how to grow a world class company through acquisitions alone (i.e. no products), look at Valeant Pharma.

[bbjdog]

Has this one been posted?

BlackBerry?s $425-million Good Technology deal not without concerns - The Globe and Mail

At least I like the picture! Canada flag and the BlackBerry letters over itt.

[Corbu]

Has this one been posted?

BlackBerry?s $425-million Good Technology deal not without concerns - The Globe and Mail

No sir! Thank you!

BlackBerry Inc. CEO John Chen almost executed the rare corporate trifecta on Friday, buying out a troublesome rival, bolstering his management team’s plan for a turnaround and gaining a nice little bump in the share price too.

As it turned out, the bump in shares was temporary, and the stock closed down 20 cents at $9.66 on the TSX.

BlackBerry’s $425-million (U.S.) deal to swallow up Good Technology – a Sunnyvale, Calif., rival in the enterprise mobile management (EMM) market – is also the largest acquisition in its corporate history. The next closest deal was the 2010 pact to buy QNX for $200-million, the connected-car platform that then became the core of the BB10 operating system.

On its face, Good Technology, a company previously known for sniping at and competing with BlackBerry, seems like a good fit. Mr. Chen wins back some of the defence and financial industry customers that abandoned BlackBerry hardware and software in recent years, and Good Technology customers gain access to BlackBerry’s suite of professional security services.

“ Good, with its customer base of 6,200 organizations, has been a leader in EMM for quite some time, as evidenced by Gartner’s rating of Good as a “Leader” in its magic quadrant for EMM in June, 2015 (versus a “Niche Player” rating for BlackBerry),” Morningstar’s Brian Collelo wrote in a research note.

But there are some concerns about the complexity of the platforms. The combined entity will have to manage at least four fairly different EMM customer bases: BlackBerry has struggled to convert its Enterprise Server customers with legacy BB7 devices to its newer cross-platform service, while Good Technology also has older clients stuck on “Good for Enterprise” who have yet to jump to its newer “Good Work” apps.

“This is a continuation of the consolidation in the mobile market and in particular the EMM market. It’s becoming clear that only the strong will survive, so bulking up is becoming even more critical,” wrote analyst Jack Gold of J. Gold Associates, noting that there remains stiff competition coming from IBM, Citrix and VMware.

On Friday, analysts reacted with watch-and-see ratings, S&P Capital IQ, Morningstar and Cannacord Genuity reiterated their hold calls.

“We think Good offers a stable revenue stream and exposure to multiple operating systems, as we note over 80 per cent of revenue is recurring and 64 per cent of activations are from iOS devices,” wrote Angelo Zino, equity analyst with S&P Capital IQ. But as receptive as Mr. Zino was to the Good Technology buy, his outlook for BlackBerry remains tough.

“While we are encouraged by recent margin and cash-flow improvements, we see limited success in recent hardware offerings and remain skeptical about management’s aggressive targets for its software business,” he wrote.

So far the new BB10 Classic, Passport and Leap devices have failed to rekindle interest in BlackBerry’s hardware. The company sells only about one million devices a quarter, while the global market shipped 315 million devices in the second quarter of 2015, according to analysts at IDC. There’s also the issue of falling revenue from the once-mighty Service Access Fee business, which BlackBerry collects only from the ever-shrinking pool of legacy BB7 devices.

These factors drove revenue down 51 per cent in fiscal year 2015, and Mr. Zino predicts revenue will still fall 16 per cent in 2016, and perhaps drop by only 4.2 per cent in 2017.

With anemic sales in handsets pulling down its chances at organic growth, Mr. Chen has been on a buying spree to focus on what he has called “tuck-in” technologies that add features to BlackBerry’s niche of security and mobility services for business customers.

With the additions of Secusmart, WatchDox and AtHoc (that last purchase has yet to close), “we secure voice, we secure file sharing, we secure alert messaging,” Mr. Chen says. “You could see we have a very secure mobile communication platforms. We look at this as end-point connectivity … [the devices] could be ours or anyone’s.”

As BlackBerry makes the transition to a software company that offers its services to any mobile operating system, it’s not surprising that the next chapter may include broadening its own hardware options.

BlackBerry is widely expected to release an Android-powered smartphone in the fall; the much-rumoured Venice phone has appeared in pictures leaked online and apparently features a slide-out physical keyboard.

Whether BlackBerry can tuck itself back into relevance in the brutally competitive smartphone marketplace using Google’s operating system remains to be seen.

[Corbu]

At least I like the picture! Canada flag and the BlackBerry letters over itt.

And the typical lukewarm comments from the G&M readers...

[_dimi_]

Remind me to sell my shares when the Globe and Mail turns bullish..

Posted via CB10

[Corbu]

Remind me to sell my shares when the Globe and Mail turns bullish..

[bbjdog]

And the typical lukewarm comments from the G&M readers...

Let me open the wine bottle before I read the comments. Lol

[Corbu]

Let me open the wine bottle before I read the comments. Lol

Don't!

Well, I mean "Don't read the comments"! Opening the bottle is

[Corbu]

BlackBerry to Buy Rival Good Technology for $425 Million - Bloomberg Business

BlackBerry Ltd. agreed to buy Good Technology Corp. for $425 million, gaining new mobile device-management customers while removing one of its competitors in that business.

Good Technology, based in Sunnyvale, California, builds applications to help employees work securely from their personal phones. It counts all of the G7 governments and the world’s 10 largest banks and law firms among its 6,200 customers, BlackBerry said in a statement Friday.

The acquisition removes a rival that had taken some of BlackBerry’s clients as more workers switched from employer-provided BlackBerrys to their own iPhones and Android devices.

“Sometimes your best defense is a good offence,” said John Butler, senior handsets analyst at Bloomberg Intelligence. “This is good for BlackBerry in the sense that it gives them greater scale and therefore a greater ability to compete with larger rivals.”

Bigger tech companies such as SAP SE, Microsoft Corp. and International Business Machines Corp. can sell tools to track mobile devices at cheaper prices by bundling them in with larger software sales, Butler said.

BlackBerry will bring together Good Technology’s secure e-mailing apps with its expertise in helping companies manage and secure thousands of connected tablets and phones, Chief Executive Officer John Chen said on a conference call.

“BlackBerry and Good combined will raise the bar in the enterprise mobility market,” he said. “We are expecting significant operating expense synergies.”

Postponed IPO

Good Technology postponed a planned initial public offering last year because of worsening market conditions, people familiar with the matter said at the time. Selling to BlackBerry makes sense for both customers and shareholders, Good Technology CEO Christy Wyatt said in a phone interview.

Earlier this month, a jury found MobileIron Inc. didn’t infringe Good Technology’s patents and that some of those patents were invalid. That could potentially have impacted the company’s valuation, said Matt Larson, a technology patents litigation analyst with Bloomberg Intelligence.

“The litigation with MobileIron certainly called into question the enforceability of some of these patents and the underlying strength of some of their existing agreements,” he said.

MobileIron’s revenue from intellectual property represented only about $25 million of the $200 million yearly revenue, Chen said.

“It’s not that big of a component,” he said.

BlackBerry could be in a better position to monetize Good Technology’s patents by bundling them into its existing licensing deals, Larson said.

“When you have the added clout that BlackBerry offers they may be able to bring that licensing revenue up,” he said.

BlackBerry expects to book around $160 million revenue from Good Technology in the first year, after writing down some of the company’s deferred revenue, Chen said. That would help the CEO hit his goal of doubling yearly software revenue to $500 million by March 2016.

BlackBerry rose 0.5 percent to C$9.91 at 1:21 p.m. in Toronto. The acquisition is expected to close later this year.