1. ToniCipriani's Avatar
    Good Tech Investors Seek To Block $425M BlackBerry Deal - Law360

    Law360, Wilmington (October 13, 2015, 9:09 PM ET) -- Investors hit the board of directors of Good Technology Corp. with a shareholder class action in Delaware state court on Monday that seeks to block BlackBerry Ltd.’s $425 million acquisition of the mobile security provider, saying the deal significantly undervalues the company.

    The suit comes in the wake of BlackBerry’s September announcement of an all-cash deal to acquire California-based Good Technology, the latest in an acquisitions spree with key buys of security- and privacy-focused assets.

    According to the suit, the BlackBerry deal is being driven solely by the self interests of several venture capital firms that control Good Technology and its board, namely Oak Investment Partners, Draper Fisher Jurvetson, Riverwood Capital, Lazard Technology Partners and Rustic Canyon Partners, which hold most of Good Technology’s preferred stock.

    Moreover, Good Technology has turned down better offers in the past year, including one for $825 million, nearly double BlackBerry’s offer. The investors claim instead of pushing a deal which maximized value for common stockholders, Good Technology Chair and CEO Christy Wyatt pushed for a “retention plan” so that she and her management team could be guaranteed millions of dollars in cash after the BlackBerry deal is consummated.

    After debt and other expenses, the BlackBerry deal would give only around $40 million to common stockholders while the preferred stockholders will receive approximately $250 million, $165.4 million of which will wind up in the pockets of the venture capital firms. Six of nine of Good Technology’s board of directors are managing directors or founders of the venture capital firms, the investors said.

    “The VC firms do not care how the common stock is priced in any change of control transaction,” the investors said in the complaint. “They want to exit the company and care only about getting paid their liquidation preferences.

    In addition to a block of the deal, the suit seeks unspecified damages.

    When the proposed merger was announced, BlackBerry said Good Technology has a strong presence in businesses and governments around the world and would bolster its enterprise mobility business as BlackBerry revamps itself with software-driven buys.

    Good Technology serves more than 6,200 organizations, including more than half of the Fortune 100, all of the Fortune 100 commercial banks, aerospace and defense firms, and leading companies in health care, manufacturing and retail, according to BlackBerry. More recently, it said Good Technology has been making a splash in the wearables market — its software platform is used to secure the Apple Watch.

    Meanwhile, Good Technology gets to team up with the likes of a larger publicly traded company, opening the door to additional customer and partnership opportunities. BlackBerry already is the mobility partner of all G7 governments, 16 of the G20 governments, some of the largest global banks and law firms, and the some of the largest managed health care, investment services, and oil and gas companies, it said.
    Though I always seem to hear about these kind of lawsuits whenever some merger goes on, not sure what to take out of it.
    10-15-15 11:52 AM
  2. early2bed's Avatar
    Six of nine of Good Technologys board of directors are managing directors or founders of the venture capital firms.
    What this tells me is that this company was always designed with the eventual exit in mind. This isn't some company owned and run by the founders that is seeking to join forces with BlackBerry to own the mobile security market. There is a lot of short-term thinking going on which should raise some red flags for BlackBerry to do their due diligence in this acquisition.

    Many of you are veterans of the webOS struggle and remember Leo Apotheker's infamous acquisition of Autonomy. There was just a write-up about it in the NY Times last week:

    http://www.nytimes.com/2015/10/09/bu...y-fiorina.html

    Lo Apotheker May Have Been Worse H.P. Chief Than Carly Fiorina

    Jeffrey A. Sonnenfeld, a professor at the Yale School of Management, has memorably called the rising Republican presidential star Carly Fiorina one of the worst technology C.E.O.s in history.

    But he didnt call her the worst technology chief executive in history. In fairness to Ms. Fiorina, she may not even be the worst chief executive of Hewlett-Packard.

    A contender for that dubious distinction would surely be Lo Apotheker.

    During their tenures at H.P., both Ms. Fiorina and Mr. Apotheker presided over what were hailed as transformative acquisitions: Compaq, the personal computer company that merged with H.P. in a $25 billion stock swap under Ms. Fiorina in 2002, and Autonomy, a British software concern that H.P. bought for $11 billion in 2011 in a deal overseen by Mr. Apotheker.

    10-15-15 12:09 PM
  3. ToniCipriani's Avatar
    Well Good has been around for quite some time. It's the same company that made Springboard MP3 players for the Handspring Visor.
    10-15-15 12:20 PM
  4. anon(8865116)'s Avatar
    I'm pretty sure the fact that Microsoft and other big MDM providers are basically selling their software for free has something to do with the lowball valuation. Take a look at some Mobile Iron and Citrix news as of late.
    10-15-15 08:34 PM
  5. DaSchwantz's Avatar
    The lawsuit doesn't have a chance.

    Posted via CB10
    10-16-15 07:51 AM
  6. Dunt Dunt Dunt's Avatar
    I'm pretty sure the fact that Microsoft and other big MDM providers are basically selling their software for free has something to do with the lowball valuation. Take a look at some Mobile Iron and Citrix news as of late.
    Everyone has an MDM solution today, and many of them have been more concerned with growth and marektshare and not with profitability. As they could just do another round of investor fund raising. But those days are coming to an end, and these propped up EMM have pretty much "commoditized" their whole sector.

    The winners will end up being big companies that offer more than just EMM alone...

    Our company uses Google for business for our domain email... includes MDM that most small business would find very adequate. All for much less than running and licensing our own Exchange Server, never mind the expense of adding a BES Server and licensing (small company - we had BESX which was free, but the server and it's software wasn't.)
    chalx likes this.
    10-16-15 02:29 PM
  7. deadcowboy's Avatar
    Suing because of a lowball offer? Or is this a hostile takeover? I'm not savvy in these things, can anyone explain?

    Posted via CB10
    10-18-15 06:39 AM
  8. EchoTango's Avatar
    Although I support the Blackberry deal as BB shareholder, I completely sympathize with the Good investors.

    This is something that I deplore even as a confirmed capitalist and believer in a free market, but this naked avouris happens to various degrees in virtually every M&A transaction today. What we're seeing is the self entitled %1 lining their pockets at the expense of the 99%. Voting themselves a larger share of the proceeds while handing out excessive fees to those who will simply manage the transaction. They just don't care as long as they get their generous cut of the transaction and to hell with everyone else. I'll bet the CEO even had a nice folksy "fireside chat" with the investors and employees promoting the deal as while painful, was the best he could do to save many jobs and preserve the "company values". I'll bet he even rustled up a few (crocodile) tears to complete the whole picture.

    If the Good Board had only allocated more of their own gains to the rest of the shareholders, then this would never have happen. I suspect the transaction will go through, but the arguing about who gets what will go on long after the Good Technologies name is forgotten.
    techvisor likes this.
    10-18-15 08:30 PM
  9. DaSchwantz's Avatar
    Good was private, so if somebody has shares, they knew about the sharks that they were swimming in the same pool with. These are the same shareholders who were counting on dumping overpriced IPO units onto the public with the help of Morgan Stanley, remember. Honestly, they don't deserve any sympathy.

    Posted via CB10
    10-18-15 10:20 PM
  10. Dunt Dunt Dunt's Avatar
    Good was private, so if somebody has shares, they knew about the sharks that they were swimming in the same pool with. These are the same shareholders who were counting on dumping overpriced IPO units onto the public with the help of Morgan Stanley, remember. Honestly, they don't deserve any sympathy.

    Posted via CB10
    I agree these "investors" got caught up in the possible potential and ignored the realities of a business model that wasn't working.
    10-19-15 08:31 AM
  11. LoneStarRed's Avatar
    Good was private, so if somebody has shares, they knew about the sharks that they were swimming in the same pool with. These are the same shareholders who were counting on dumping overpriced IPO units onto the public with the help of Morgan Stanley, remember. Honestly, they don't deserve any sympathy.

    Posted via CB10
    Nuff said.

    "I don't think that word means what you think it means."
    10-19-15 08:43 AM
  12. EchoTango's Avatar
    Nobody puts their money into a venture expecting to loose it.

    I agree with your "buyer beware" thinking but most of the the common shareholders were probably investing in the "ground floor" of a company with much hope and promise, expecting a large reward in exchange for the higher risks. It's one thing to have a company self-destruct leaving no assets to distribute, it's quite another to actually sell the company and then allocate the lion share of the proceeds to the "entitled" few.

    Also a private company issues warrants for shares, to be delivered once the company goes public.
    techvisor likes this.
    10-19-15 10:24 AM
  13. DaSchwantz's Avatar
    Yeah well, small venture is 10:1 loss to gain ratio, so again, no sympathies from me. Don't dive in the pool if you don't know how deep it is. This is a company that for the past 5 years has been spending a good chunk of its marketing dollars spreading anti-blackberry propaganda with enterprise clients to create the growth that was going to be used for the exit strategy.

    Posted via CB10
    theRock1975 likes this.
    10-19-15 06:34 PM
  14. Dunt Dunt Dunt's Avatar
    Yeah well, small venture is 10:1 loss to gain ratio, so again, no sympathies from me. Don't dive in the pool if you don't know how deep it is. This is a company that for the past 5 years has been spending a good chunk of its marketing dollars spreading anti-blackberry propaganda with enterprise clients to create the growth that was going to be used for the exit strategy.

    Posted via CB10
    Sadly BlackBerry had to compete with both Good and Mobile Iron... which is why the "value" of their BES business has been hurt so much. With Good being taken in, and Mobile Iron out of the private/startup phase. BlackBerry has a better chance of making BES a profitable division now....

    If Apple and IBM don't throw a kink into the mix.... cause right now Apple is in the drivers seat. Based on what they are doing with the PRIV, BlackBerry will soon be out of the hardware business completely.
    10-20-15 08:02 AM
  15. DaSchwantz's Avatar
    Sadly BlackBerry had to compete with both Good and Mobile Iron... which is why the "value" of their BES business has been hurt so much. With Good being taken in, and Mobile Iron out of the private/startup phase. BlackBerry has a better chance of making BES a profitable division now....

    If Apple and IBM don't throw a kink into the mix.... cause right now Apple is in the drivers seat. Based on what they are doing with the PRIV, BlackBerry will soon be out of the hardware business completely.
    Agree on first point. Jury is out on the second. The buzz in android circles is certainly stronger than I expected, and the margins are going to be better, even if they have to drop prices.

    Posted via CB10
    10-20-15 03:03 PM
  16. Dunt Dunt Dunt's Avatar
    Agree on first point. Jury is out on the second. The buzz in android circles is certainly stronger than I expected, and the margins are going to be better, even if they have to drop prices.

    Posted via CB10
    But the Android circles aren't impressed with the price at all.... and if the "BlackBerry Experience" affect performance and benchmarks. Those same circles will laugh the PRIV right out of AndroidCentral (other the other sites that cover Android).

    I was on one today and they are hyped about the Galaxy S7 being rumored to be released in January now.... supposedly Samsung is moving it up due to slower than expected sales of the S6 and some new features that are designed to better compete against the new iPhones. So I'm not so sure how far the specs of the PRIV or it's Keyboard will carry it's premium price tag. As the S7 is two or three generation ahead of the PRIV.

    If Privacy/Security and Keyboard are important... it will sell. If not..........
    10-20-15 03:32 PM
  17. DaSchwantz's Avatar
    But the Android circles aren't impressed with the price at all.... and if the "BlackBerry Experience" affect performance and benchmarks. Those same circles will laugh the PRIV right out of AndroidCentral (other the other sites that cover Android).

    I was on one today and they are hyped about the Galaxy S7 being rumored to be released in January now.... supposedly Samsung is moving it up due to slower than expected sales of the S6 and some new features that are designed to better compete against the new iPhones. So I'm not so sure how far the specs of the PRIV or it's Keyboard will carry it's premium price tag. As the S7 is two or three generation ahead of the PRIV.

    If Privacy/Security and Keyboard are important... it will sell. If not..........
    I don't know how you can make statements like "the S7 is 3 generations ahead of the Priv"...please explain exactly what each of the generations are.

    Posted via CB10
    _dimi_ likes this.
    10-31-15 12:19 AM
  18. Prem WatsApp's Avatar
    I don't know how you can make statements like "the S7 is 3 generations ahead of the Priv"...please explain exactly what each of the generations are.

    Posted via CB10
    Fingerprint scanner, Android M, and maybe a few more S-gimmicks... ;-P

    Generational leap!

     Priv New (Chendroid) World...? :-| 
    11-04-15 06:50 PM
  19. DaSchwantz's Avatar
    Fingerprint scanner, Android M, and maybe a few more S-gimmicks... ;-P

    Generational leap!

     Priv New (Chendroid) World...? :-| 
    Sounds like Android M is coming to the Priv before or around when the G7 would be available...fingerprint scanner is an iCopy...meh...specs...likely some version of forcetouch...my definitions of generational upgrades seem to be a bit more stringent...barely stretching one, let alone 3, in my opinion. Maybe if you consider the 14nm Sammy chip vs Qualcomm I'd say more than one...

    Posted via CB10
    11-04-15 07:00 PM

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