12-22-12 07:04 PM
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  1. gtpointer's Avatar
    Or, because they're still financially in the black, have a good action plan, and no interest in being purchased currently.
    Being in the black is good for a takeover target...means there's plenty of scope to saddle the target with debt to fund the acquisition. Also, the fact the Board isn't interested doesn't mean the shareholders wouldn't sell - hostile takeover anyone?. Its action plan is also irrelevant. The reason RIM won't be taken over by Apple is a) (most importantly) competition grounds and b) it will be a lot cheaper if BB10 fails, so no sense buying it now, you'll just be paying for an almost completely developed product you'll never use.
    12-22-12 01:35 PM
  2. CairnsRock's Avatar
    You ask 2 questions. Yes Apple could buy RIM easily. I think they have over 100 BILLION dollars in cash in the bank. The market capitalization of RIM is about 7 Billion. Even at a ridiculously high premium say 10x Apple could easily pay. You need to ask yourself why would they buy RIM?

    Your second question. Have a look at Apples acquisitions over the last ten years. Some small portion is typically added to the core OS or hardware functionality and the rest disappears.
    Agreed. Just like buffalo hunters, kill it for its skin and leave the rest to rot.
    12-22-12 02:05 PM
  3. Easy-G's Avatar
    If RIM need be acquired it should be by MS. Then the lines would be more firmly drawn.
    I agree, a takeover by Microsoft seems to be the most likely scenario. Microsoft would get phones with global brand power and infrastructure. BlackBerry would gain the desktop space as a vertical and official Office support.
    12-22-12 02:18 PM
  4. morganplus8's Avatar
    The OP has asked a very good question and I'm not sure it has been answered yet. From a business point of view, Apple is unencumbered to make an offer to purchase RIM. The Prime Minister and the Minister of Finance have both stated, on many occasions, that they would not stand in the way of the company seeking help to survive. That includes, financing, partnerships and yes, merging or being bought out by others. It is unlikely that a Canadian company would purchase it because of the price, but a combination of companies could generate enough funds to make it happen. So, assuming that the government keeps their word and wouldn't stand in the way of a purchase, what would it take for another company (foreign) to step up and buy RIM? It doesn't matter if that "other company" is Apple or MS or anybody else in this matter.

    The reason it hasn't happened yet, is because of the math, plain and simple. How much would it take to acquire RIM? For a successful bid, you need to own a stake in the company, at 10% you have to declare to the world what your intentions are, are you simply investing in RIM or are you planning to buy more shares and perhaps make an offer? Apple could buy 10% of the outstanding and issued shares and then announce they are making an offer for the rest. They could sit at 9.9% and invest in it unannounced, or, they could add more shares by stating that they are in fact still investing in the company. This is not how most transactions would take place when you are purchasing the competition though. And so, the action would be more like this, they would purchase 9.9% of the companies' shares in the open market and then announce/make a formal offer. They can't simply offer 30 - 40% more than the current price and expect it to fly. They do a share count and see who owns stock and ask themselves "at what price could enough shareholders be persuaded to part with their holdings in order to achieve the minimum % of shares needed to make a successful bid", in Canada this minimum is 90%.

    Now Prem Watsa holds 9.9% and the twins hold 12% between them and certain others hold large percentages too. How could Apple offer a price level that would draw those shares out of these key players? The price has to satisfy 90% of the shareholders and that's almost impossible to do at anything below $ 25.00/shr. And so now you know why there hasn't been an offer, the minimum price would likely be $ 20.00/shr plus for Prem Watsa alone as his average is currently $ 19.00/shr.. Would Apple be prepared to spend $ 15 billion to get the company? Not likely, for that amount, you would setup your own Enterprise or buy more patents etc. No one is going to offer that kind of money until RIM makes money and BB 10 is proven successful. Samsung might partner with RIM, so might others (likely soon) but there isn't a buyer for miles at that valuation. You see, big block holders want to sell it as a going concern and Apple (and others) would like to purchase it for less than book value.

    For the fun of it, how much are they really paying? Apple would buy 10% of the stock at $ 14.00/shr on average, they would offer to buy the company for $ 18.00/shr and get 60% of the takers at that level, they would then make their final offer for the balance North of $ 23.00/shr and hope to get 90% of all of the shares outstanding. If Prem Watsa wants more than $ 23.00/shr, he will have to buy some additional shares in the open market to block the 90% rule. Then there is the twins, who knows what they want!!! Hence, there won't be an offer until RIM can stand on its own two feet.

    To answer the question, sure Apple has every right to purchase RIM, will they, not likely as management has made it clear that they aren't for sale and Prem Watsa has invested at a level that it is unlikely anyone will provide him with a decent return before BB 10 launches and makes some traction.
    Roo Zilla likes this.
    12-22-12 03:32 PM
  5. silversun10's Avatar
    in case BB10 succeeds and turns the touch smart phones market into a commodity market Apple will have to compete on price,
    if that were the case the price in lost revenues to Apple might exceed the actual purchase price for RIM and under those circumstances
    it starts to make sense for Apple to control one competitor buy buying RIM out.
    12-22-12 07:04 PM
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