[morganplus8]

As long as whatever offer it is comes before November like the rumor has it, I will be happy.

Potatoman3!!

First of all, that rumour came from one source, The Wall Street Enquirer, so it isn't strong. The logical issue here is time, Prem needs to act fast and get his offer out there before anyone else has a chance to. If he buys shares in the open market today, then makes his offer close to $ 17.00.shr (his current breakeven and less if he is a buyer today) .... then all others will follow over the weeks and months ahead at a higher level, whether it is for a break-up of the company or an out right buy. He is truly sitting in a nice place for this deal if he can make an offer quickly here.

If BBRY has to go, I want to see MSFT in on the deal for big bucks. Do they have time to assess the company and beat Prem to the punch?

[ibpluto]

2. If Prem does offer, say, $20 a share, could short covering temporarily spike that price higher? Or would any price spike happen only during the rumors stage?

I'm curious about this also

[morganplus8]

Do you think that they'll announce an agreement during the ER?

Not likely, Prem will make an offer as soon as he can pull the deal together. The sooner he makes an offer, the clock starts ticking towards the final deal/agreement. His hope is to take the company private or see it go out at a much higher premium, he likely doesn't care. If you read some of my other messages, he needs to act fast and that means an independent bid ASAP. The board will need plenty of time to assess each offer from others. This could take weeks and possibly months to finalize here. The best part of all of this occurs after Prem makes his first offer. Think of it this way, he offers $ 16.00/shr and 50% of the market submits to that offer, he then increases it to $ 17.50/shr and gets 35% of the trading shares to sell to him, he is now close to completing the deal and shutting out all other bidders. He only has to raise it to $ 20.00 to get the rest. That's why he needs to act fast here. You might see an offer before the Q2 report is out, that's how fast he needs to go here. Just my take of course. GL

[morganplus8]

I'm curious about this also

This doesn't happen in 99% of cases, the offer price always comes with an arbitrator who eats the shares by transferring shares submitted and sold at that offer price with the short shares outstanding. There won't be a spike unless the first offer is way too low and not fair value for the company. An offer today for $ 13.50/shr would see a spike, an offer from Prem at a logical $ 15.00/shr would likely sit there and collect SOME shares from investors, anything above that will not achieve the offer price until the deal closes. Hope this is clear?

[Rickster1]

Little break out, backed off from the $11.65 high to $11.57. Good to see it creep up!

[Andy_bb_king]

Guys, sorry to repeat again, whoever got this company under $40, which values BlackBerry only about 20 billion market cap, it is stealing. Refuse to sell any thing below that!

Posted via CB10

[jake simmons3]

Looks like I was some what correct in guessing we would hit 11.50 today , only reason I guessed this was because the trading was different at the beginning of the day

[ibpluto]

This doesn't happen in 99% of cases, the offer price always comes with an arbitrator who eats the shares by transferring shares submitted and sold at that offer price with the short shares outstanding. There won't be a spike unless the first offer is way too low and not fair value for the company. An offer today for $ 13.50/shr would see a spike, an offer from Prem at a logical $ 15.00/shr would likely sit there and collect SOME shares from investors, anything above that will not achieve the offer price until the deal closes. Hope this is clear?

It does, it helps me understand when I should sell ....Thanks Morgan.

[timmy t]

So Prem Watsa and possibly Mike Lazaridis can demand to buy my shares at an agreed upon price?
How does this make any sense?
Major shareholders coming to an agreement with the BOD to take my shares whether I want to sell them or not seems hard to take.

[ibpluto]

So Prem Watsa and possibly Mike Lazaridis can demand to buy my shares at an agreed upon price?
How does this make any sense?
Major shareholders coming to an agreement with the BOD to take my shares whether I want to sell them or not seems hard to take.

Yup, especially if the offer is below what you paid. This is however the risk in investing in any stock. The alternative which is going down to zero and losing everything would be far worse. If you make some bank on the offer, maybe its not as much as initially hoped, at least you made, not lost. In the end, you can take that change and find another game to play on.

Is what it is .......

[OMGitworks]

So Prem Watsa and possibly Mike Lazaridis can demand to buy my shares at an agreed upon price?
How does this make any sense?
Major shareholders coming to an agreement with the BOD to take my shares whether I want to sell them or not seems hard to take.

They can get it done without your say depending on how the deal is structured. Usually a super majority vote of shareholders could be required to sell or for other major corporate action. Two-thirds or something like that in most cases. Canada could be different. They can also do smaller deals or variations of the full sell out without any shareholder input.

[BBNation]

Hi fedakd!!

Pretty complicated isn't it? There are several kinds of shorts here, some have losses, some have substantial gains, some are hedged and some are there to hold down the price of the stock while owning shares to off-set the price movement. So it is difficult to know where the trigger point is for each group. I suspect that of the 500 million shares traded since the June 28th Q1 report, a chunk of those are held in very good hands. Let's say 20% of those shares are part of a story that will unfold in the weeks ahead. The stock is held down to acquire shares for an offer, they are also shorted to setup an offer at some price above current levels. Some good math will tell you what price needs to be paid in order for the acquirer to get enough votes to take the company over or go private. In any event, it will be higher than today's price as the trading in the stock will result in a profit for someone at these levels.

I think that Prem, JP Morgan and others are doing the trades today and control the price of the stock. That's why I don't think the Q2 results in a couple of weeks means anything. They are WAY beyond those numbers knowing what they will expect from the company. This is why Prem left the board, so the board could consider all offers and make Prem's offer legal and binding. When you buy a company, you buy up all of the shares in it that are below your offer, this hasn't happened yet. A company like MSFT wouldn't do this, they are more likely to make a bid for all of the outstanding shares at a set price, this means it will cost them much more to take BlackBerry off the market than say Prem. This is why I state that Prem has first mover status, he owns a big block of stock that doesn't need to be paid for twice. All other buyers need to buy into the rally or pay a great deal more for the company.

This is also why I think the company will see a break-up in its assets as part of a deal. I don't think they can put together a partnership big enough to stop a take-over or going private. The assets are worth too much for a simple partnership to take place. The idea of a deal around $ 14 - $ 15 came about by the media because they simply applied a 40% premium to the then current price of the stock. So now you would logically apply the premium to the "current price of the stock" which is $ 16.00/shr today. What will the price be when the stock is actually halted for an offer? I think it will be much higher when that happens, let's say $ 14.00/shr.. So now you have a potential of a first offer around $ 19.00/shr plus which is where I think we are going.

This isn't Dell, they don't have the leverage to extract huge percentage gains out of their assets. Secondly, BBRY is much cheaper of a deal here. Prem and company only need to buy 455 million shares to take the company private, everyone else needs 524 million shares to do a deal. With 455 million shares and some unknown quantity held by others, Prem and his group can afford to pay you and I $ 22.00/shr and still own the company for a much lower amount on the whole. Good luck to MSFT in completing with Prem!

And so those shorts are a mixed bunch, some of them are going to lose a bundle, most won't, let's see how it plays out here!

I guess I have to make my guess as to what Q2 will look like so I had better go, thanks for the kind words my friend!

I thought Prem or any one can not buy more than 10% of company per Canadian regulation. Unless you declare your intent of purchasing the company. ANy thoughts, corrections ?

[jake simmons3]

I thought Prem or any one can not buy more than 10% of company per Canadian regulation. Unless you declare your intent of purchasing the company. ANy thoughts, corrections ?

Who said Prem is the one buying today

[OMGitworks]

I thought Prem or any one can not buy more than 10% of company per Canadian regulation. Unless you declare your intent of purchasing the company. ANy thoughts, corrections ?

Joint venture between PW and pension funds or others or new entity will buy BBRY. PW will like own a larger % of the JV. In the US, if notice of the accumulation of shares would disrupt the market, you can get SEC clearance ahead of time and not have your filing immediately made public. Icahn and others have done this before. All in the name of an efficient market....

[lcjr]

So Prem Watsa and possibly Mike Lazaridis can demand to buy my shares at an agreed upon price?
How does this make any sense?
Major shareholders coming to an agreement with the BOD to take my shares whether I want to sell them or not seems hard to take.

Just think how those that bought in at $66 back in 2011 feel right now.

[morganplus8]

Hi Reed!!!

Here are my comments below:

Hi Morgan, thanks so much for your thoughts! Here's what I'm wondering:

1. It seems like a deal to take BlackBerry private could be put together much more quickly than potential partnerships and spin-offs. If that's the case, how informed will the other large institutional share holders be about potential offers and partnerships? If Watsa and Lazaridis put together a bid to take BlackBerry private, say two weeks from now, will the other large shareholders be able to weigh that bid against growing interest from Microsoft or other suitors? Or will they be in the dark about what the Board might have in the works?

There is a problem here, if the offer from Prem to take it private is a good one, other potential offers will back away from the deal and we will never know if the deal is the best on the table. We will accept it and move on. In the end, we care only about the price, if we can get enough for our shares to go onto the next trade, we are gone. So yes, if the price is at $ 18.00/shr, there might not be many interested doing the intensive review to make a counter offer. The flip side is that Apple might like to buy the whole thing and part it out minus the Enterprise and Patents, they won't care about the price if they can shut out the competition. So it could go crazy in the weeks ahead here.

In other words, would large shareholders jump at a $20ish/share price offer now, or would they hold out to see what would happen from other deals? Sounds like Prem is pretty convinced there is high value in some of BlackBerry's assets, so would the others potentially leave money on the table by accepting his bid?

I could see Prem getting 50% of the shares he doesn't already own on his first offer. Many will want to stay in and see this play out though, as a 50% response is clearly not enough to take the company private. Prem knows what that sweet number is, and will work towards it as he collects shares at a lower price.

2. If Prem does offer, say, $20 a share, could short covering temporarily spike that price higher? Or would any price spike happen only during the rumors stage?

There is little likelihood of a short squeeze happening here as the shorts know the shares are available to them at the offer price. If Prem low balls the offer, you will see a spike. I can't imagine he will do that but it is a great way to get more shares quickly. I think we will see something happen soon followed by plenty of noise about Lenovo picking up the hardware assets and a license package relating to BBRY's patents to go along with those assets. Lenovo couldn't talk about buying the company but they can talk all day about buying part of it.


Thanks to everyone for the conversation, great stuff!

[Kid Vibe]

Holy Morgan! Wicked stuff.

I can't believe I'd come to see the day where I was happy to break through the 12 dollar barrier... lol :/

[m1a1mg]

So Prem Watsa and possibly Mike Lazaridis can demand to buy my shares at an agreed upon price?
How does this make any sense?
Major shareholders coming to an agreement with the BOD to take my shares whether I want to sell them or not seems hard to take.

If you look at the Dell case, the board was going to accept the offer from Michael Dell and Silver Lake. Icahn tried to stop it. The board seemed to think they had enough of the major shareholders to act.

[morganplus8]

So Prem Watsa and possibly Mike Lazaridis can demand to buy my shares at an agreed upon price?
How does this make any sense?
Major shareholders coming to an agreement with the BOD to take my shares whether I want to sell them or not seems hard to take.

It isn't that bad, they have to acquire at least 90% of the outstanding shares traded in order to start the process of taking shares away from you. They might just offer you a bit more and proceed to redeem them. You can't hold onto those shares forever if the company complies with the legal process to be sold. Why would you want to hold shares in a company that no longer trades on the open market? You might be lucky if they offered 10 cents on the dollar for your shares under those conditions. It would be time to move on.

[morganplus8]

I thought Prem or any one can not buy more than 10% of company per Canadian regulation. Unless you declare your intent of purchasing the company. ANy thoughts, corrections ?

This is true, he has to state his intention at certain levels of ownership, at 10% he has to declare if it is for investment purposes or not. But, he can buy shares from JP Morgan in one after hours cross (say tonight) and suddenly own 35% of the company by doing this at several levels with others. He would then submit a formal offer to the company knowing he holds a very large block. It is all in the timing as he has several days to make his statement and a lot can happen in several days! Going private is easier, he would have CPP and others buy 9.9% each in the open market and get there this way without notification.

[Im Mo Green]

Hi Reed!!!

Here are my comments below:

Thanks Morgan for your insights. I agree, Ithink the hardware going to Lenovo scenario is in the cards here. The patents can be licensed or go to Lenovo like yiu mentioned. The infusion of cash, and the resizing of bbry into a much smaller size enterprise software could be extremely profitable looking forward. Do you see anyway, that blackberry will remain a publicly traded company after this plays out, or it's private or just sell off the pieces. What scenario do you see ultimately unfolding.

Thanks for your thoughts.

[ibpluto]

well gents ...not a bad day. Hopefully this week keeps bringing good results

[Reed Richards]

Great, Morgan, appreciate the insight. This promises to be very interesting. Hope we can get into the 20s for a share price, one way or another!

[cgk]

Anyone hearing anything to confirm or deny claims of additional lay-offs today (there is a thread in news and rumours)?

[Shanerredflag]

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AWESOMENESS!!!