[Kid Vibe]

But the deal is far from complete. It is subject to six weeks of due diligence, and BlackBerry can shop the company during that period. Fairfax would still have to arrange financing.



The agreement also doesn't compel Fairfax to ultimately come forward with a firm offer, underscoring the weak negotiating position BlackBerry finds itself in. BlackBerry, on the other hand, would have to pay a breakup fee of more than $150 million if it turns to another buyer by Nov. 4.



BlackBerry's unusual move to put together a loosely structured deal was motivated by its rapidly deteriorating business, several people close to the situation said. By publicizing a deal with a starting price, the company's hope is that will lure rival offers for part or all of BlackBerry, one of the people said. This person characterized the proposed deal with Fairfax as a "backstop" in case nothing better comes along.



Fairfax had some of the same interests. "We thought, every day that goes by, if the position of the company wasn't stabilized they would lose employees and customers, and we thought it was appropriate to do the deal [now]," said Fairfax Chairman and Chief Executive Prem Watsa in an interview



BlackBerry chairwoman Barbara Stymiest said in a statement that the special board committee formed to evaluate options is seeking the best deal and will listen to alternatives to Fairfax's proposal.



A number of private-equity firms in the U.S. and Canada, and possibly tech companies in Asia, have considered bids for at least part of the ailing Canadian company, people familiar with the matter have said. But it isn't clear if they are currently interested. BlackBerry formed the strategic committee to search for a buyer about six weeks ago.



Even if a deal does go through, BlackBerry's future remains unclear. The company said Friday it would stop selling its phones to consumers after weak demand, and few analysts ascribe any value to BlackBerry's namesake smartphone business.



There are a number of assets that could be attractive to a potential buyer. BlackBerry's cash pile, while falling, sits at about $2.6 billion, while its patent portfolio is generally valued at more than $1 billion. The company also still has a widely respected security network on which phone data is transmitted, also said by analysts to be worth more than $1 billion.



"I know most people don't think so, but we think over time [BlackBerry] can be successful again," Mr. Watsa said in an interview. "We think in a private setting this company can do well, without all the noise from the marketplace."



Mr. Watsa, who stepped down from the board last month to avoid potential conflicts of interest, said the company's recently announced plan to refocus on business customers "is the right way to go." But he said the investor group hasn't decided whether or not the company's current management team will stay in place or whether BlackBerry will continue to make phones. "It's early days," Mr. Watsa said.



Mr. Watsa acknowledged the company's latest poor quarterly results and said they would be examined carefully. "There have been some significant write-offs recently so we've got to understand that" before a deal is completed.



And he conceded that the pace at which BlackBerry was losing customers and market share—and burning cash—was a factor in the deal's timing.

Canadian pension funds will likely be involved in the deal, Mr. Watsa said, without providing specifics.



BlackBerry didn't say who, apart from Fairfax, would take part in the consortium, but according to people familiar with the matter, Canada Pension Plan Investment Board and Ontario Teachers' Pension Plan could take part.



BlackBerry co-founder and former co-chief executive Mike Lazaridis is considering a separate offer, people familiar with the matter said. Mr. Lazaridis has also discussed a joint bid with Mr. Watsa, two people said.



Mr. Lazaridis's interest in the company is serious, and he could still make a competing bid, a person familiar with the matter said Monday. Mr. Lazaridis already owns a stake in the company, which amounted to 5.7% earlier this year, and this person said he has more firepower at his disposal.



Mr. Lazaridis, through a representative, declined to comment.

[dusdal]

Can't help but feel we got shafted. Premier trying to protect his investment.

It just feels like the last two quarters have been an intentional sandbagging to drop the SP.

Hopefully a bidding war starts, but I don't know how likely that is with the Canadian government in the picture.

Posted via CB10

My Z always replaces 'Prem' with 'Premier ' as well.

Posted via CB10

[cgk]

most people maybe, but these things can change on a dime.
we are on a diet of daily halts now.

It's not going to go much higher because of the lack of value - I suspect that the cost of the shutdown of the hardware division (which is sure to happen in the same way night follows day) is a lot higher than we think because of inventory and contractual obligation and anyone who takes a look at the books will see this. The value is in the cash, the IPR, some in the enterprise and a hard to work out value of BBM.

[Superfly_FR]

The fact that the stock is at $8.82 shows that nobody has any faith that anyone else is making a bid.

You call "nobody" the street (WS), right ?

[greggebhardt]

Can't help but feel we got shafted. Premier trying to protect his investment.

It just feels like the last two quarters have been an intentional sandbagging to drop the SP.

Hopefully a bidding war starts, but I don't know how likely that is with the Canadian government in the picture.

Posted via CB10

Sandbagged without a doubt. It is common practice to manipulate.

I can not see any bid war. Blackberry should have been sold months ago. The "dragging it out" and lack of sales performance resulted in the sale we have today. With all things considered the $9 is not a bad deal for both parties.

At least Blackberry can move forward at this point.

[cgk]

You call "nobody" the street (WS), right ?

You still hold out for Steve Balmer riding a white horse and carrying a big bag of cash?

There is only one game this autumn and it's called Grand Theft Blackberry

[zhaolianf]

What will happen if I don't sell the stock before the date BBRY go private?

[world traveler and former ceo]

Let the bidding begin!... this is just A measure to establish a floor.....

Posted via CB10

[bkupris]

With a little luck another buyer or two will come out of the woodwork for a happy ending

[Superfly_FR]

It's not going to go much higher because of the lack of value - I suspect that the cost of the shutdown of the hardware division (which is sure to happen in the same way night follows day) is a lot higher than we think because of inventory and contractual obligation and anyone who takes a look at the books will see this. The value is in the cash, the IPR, some in the enterprise and a hard to work out value of BBM.

I'm pretty sure that hardware shutdown won't happen.
I wrote about it in another thread, with several other considerations.
here : http://forums.crackberry.com/news-ru...ml#post9227806

[Superfly_FR]

You still hold out for Steve Balmer riding a white horse and carrying a big bag of cash?
There is only one game this autumn and it's called Grand Theft Blackberry

I don't care about the cash much. I care about (a) partner(s) that will reassure about the company future.
Once announced (I fear this won't be the case prior the bid signature; would raise the stock price ...), financing the organic growth won't be a problem : there are banks for that.

Edit: for the record, that's what I've suggested for months. A complex combination of "private + partnerships/equity partners + patents rent". Not the best for shareholders, I admit. But for the company, probably the very best option. Now, for MSFT ... I'm stubborn and contrarian; yes, as an equity partner, they're still on top of my list (add IBM, CISCO,SAP) !

[Komoto]

Gregg,

The issue is that we have been made to think that the 9 dollars is a good deal for both parties.

It just simply is not.

The turn around is coming and even without it, the assets are valuable.

I know what people will say; something's value is what someone is willing to pay for it.

I know some basic accounting and know that the way they went about the pre-ER was unnecessary. They actually made things look even worse than they really are!

If they had got to ER, and reported 2.2 mil bb10 sales it is a completely different story.

Anyway as I said I always knew there was a very real risk of this happening. I weighed the risk VS reward. Looks like I may have lost this round.

I will still hang on. The way I see it is that there is only an opportunity to go up from now.

It seems as though this whole thing from Prem is to try and force some hands that would have waited around...

If a bidding war starts we may see this go up. I have a funny feeling taking her private was always the plan.

Posted via CB10

[georg22]

At least, we know now, that the "for sale sign" will be removed within the next 6 weeks. I think this is extremely important, especially for enterprise customers but also for possible partners.
When this drama is over, the company can make new deals much easier.

But have the bad feeling, that the company also needs a hardware partner to accelerate the BB10 platform...

[jxnb]

Does anyone know why CrackberryKevin is in Korea now? He is not going to Blackberry Jam Asia. In his last two podcasts from his hotel room in, I believe, Seoul, he says he has meetings over the next few days. However, he and the other podcast members carefully steer clear of why Kevin is there. There is a "Why is Kevin in Korea?" thread, but no concrete information. Sorry in advance if my question proves not to be relevant.

[greggebhardt]

Gregg,

The issue is that we have been made to think that the 9 dollars is a good deal for both parties.

It just simply is not.

The turn around is coming and even without it, the assets are valuable.

I know what people will say; something's value is what someone is willing to pay for it.

I know some basic accounting and know that the way they went about the pre-ER was unnecessary. They actually made things look even worse than they really are!

If they had got to ER, and reported 2.2 mil bb10 sales it is a completely different story.

Anyway as I said I always knew there was a very real risk of this happening. I weighed the risk VS reward. Looks like I may have lost this round.

I will still hang on. The way I see it is that there is only an opportunity to go up from now.

It seems as though this whole thing from Prem is to try and force some hands that would have waited around...

If a bidding war starts we may see this go up. I have a funny feeling taking her private was always the plan.

Posted via CB10

You might be right but I do not think that bidders will be lining up to bid on BBRY. I know that some of the BBRY stockholders are trying to look on the bright side but thinking that this will be bid up is foolish. I think it will be a miracle if the current bidder can drag enough investors with him to keep his deal. Just think how all of this must be affecting the sales, like they were not bad enough.

[Superfly_FR]

You might be right but I do not think that bidders will be lining up to bid on BBRY. I know that some of the BBRY stockholders are trying to look on the bright side but thinking that this will be bid up is foolish. I think it will be a miracle if the current bidder can drag enough investors with him to keep his deal. Just think how all of this must be affecting the sales, like they were not bad enough.

Watsda offer is necessarily under the "fair value". What fool would give a fair price as the first bid ?
I believe it's interesting to keep this in mind. Yet I'm not sure we'll have other bids.
If PW has problems to drag investors, then I believe he'll have to unveil who his allies are (equity partner(s)). Then it could bring traction and motion on the stock value.

Discl : this is pure speculation.

[emtunc]

Does anyone know why CrackberryKevin is in Korea now? He is not going to Blackberry Jam Asia. In his last two podcasts from his hotel room in, I believe, Seoul, he says he has meetings over the next few days. However, he and the other podcast members carefully steer clear of why Kevin is there. There is a "Why is Kevin in Korea?" thread, but no concrete information. Sorry in advance if my question proves not to be relevant.

Brokering a deal between BBRY and Samsung obviously - why else would he be there?!

[silversun10]

What will happen if I don't sell the stock before the date BBRY go private?

your broker will give you instructions on what your options are when anything materializes

[cgk]

You might be right but I do not think that bidders will be lining up to bid on BBRY. I know that some of the BBRY stockholders are trying to look on the bright side but thinking that this will be bid up is foolish. I think it will be a miracle if the current bidder can drag enough investors with him to keep his deal. Just think how all of this must be affecting the sales, like they were not bad enough.

Which is why hardware is toast - who is going to spunk millions if not billions on developing and trying to sell handsets in a market where ever the prosumers and enterprises are happy with other devices. While you can provide niche services, you can't provide niche handsets, the development costs are the same (unless you make crappy devices). They will spin out the fantasy of hardware long enough to sell off the remaining handsets or give them effectively free to enterprises to try and drive up BES adoption.

[cgk]

We all love seeking alpha right?

You would think the drama would have finally come to an end. BlackBerry (BBRY) has a tentative deal to go private, with major shareholder Prem Watsa and Fairfax Financial (FRFHF.PK) taking the firm private for $9 per share.

It would seem to be an ignominious end for the company's run as a publicly traded company; BBRY trades more than 90 percent off its highs of just a few years ago, when the company was known as Research in Motion. And the low price, following BlackBerry's desperate attempt to sell itself and a disastrous second quarter earnings pre-announcement on Friday, would seem to finally convince BBRY bulls of their need to move on.

Amazingly, it hasn't. Commenters on this site, Twitter, and elsewhere continue to show the same optimism that has cost BBRY shareholders billions of dollars over the past couple of years, well after the company's struggles had become crystal clear and its downward spiral set in motion.

[ADGrant]

Welcome back.... let's figure this LOI out and discuss the reason for Prem's low ball offer.

The bigger question is why the board accepted the offer. They clearly don't consider it a lowball offer.

[cjcampbell]

For those saying the ER warning was to drop the price in order to let Prem and co to make a cheaper offer, let it go. We are talking the difference of a week and in the business of billions, a week is nothing. The warning needed to come, offer or not, to give shareholders ample time to decide what to do going into the ER and finding out more of the details. Remember June? The vast majority of us got to sit here and watch millions of shares trade PM with no option other than to sit and watch the price continuously drop and that one wasn't bad. It was the handset numbers that did it in. What that did was give fair opportunity to all holders to act as they saw fit. Doing it so late in the day, however, is a kick in the pants, but I suspect is was to halt any more damning leaks that may have happened over the weekend, which no doubt would have happened.

Just my 2 cents on it.

[Komoto]

Cgk,

unless someone takes on hardware where it is already their primary business, like Samsung or lenovo..

That way they are simply adding volume to the current business through another brand.

Marketing costs would be Zero as they are not going to marketed to consumer. R and D would be negligible as they are doing it anyway.

It makes a lot of sense for a company like that. The issue is would the Canadians allow it/would they retain a lot of their contracts.

I don't see your logic.

Posted via CB10

[kfh227]

Backup, I need all the info I can get. Ignore the trolls...

Worst case: Fairfax bid falls through, SP hits hard.

Once again, 8 new contracts tomorrow, whether those are significant are yet to be determined. BBM is still a work in progress and won't be out for atleast a week. Will we ever see $15, doubtful...

Due to technical difficulties there will be no announcement.

Posted via CB10

[Komoto]

The bigger question is why the board accepted the offer. They clearly don't consider it a lowball offer.

I'm sure some friendly relationships were formed when they were all on the board together.

You don't think everyone is a saint do you?

Posted via CB10