Is RIM, considering going private? (Hopefully)

I hope so, screw the stock market jerks. RIM is another example of a still profitable and highly respected company, who, because they cannot continue to make obscenely high profit margin's is being cast aside. Screw the stock market. Run RIM, run!

"RIM has lost favor as the email-centric BlackBerry falls behind in a fast-changing smartphone market now dominated by Apple Inc's iPhone and devices using Google Inc's Android software.

Still, the nomination of financier Timothy Dattels to the board could indicate RIM is more seriously considering going private, or mulling a leveraged buyout for the company.

Dattels, a senior partner at private equity firm TPG Capital LP, previously served as Goldman Sachs' head of investment banking for Asia excluding Japan.

He replaces Antonio Viana-Baptista, a former Telefonica SA executive who had been a RIM director since September 2009. RIM said Viana-Baptista opted out so he could spend more time in his role as CEO of Credit Suisse in Iberia.

RIM is proposing the re-election of the remainder of its board at an annual meeting on July 10. It said it would look to add one or more new board members in the current fiscal year.

RIM's Nasdaq-listed shares closed 2.5 percent lower at $10.40 on Thursday. The stock has lost more than 70 percent of its value over the past year."

To read the full article, go here;

RIM shares drop after minor board shuffle | Reuters

Michaelaw

I think if RIM doesnt do well with BBOS10 then you will see them go private. Too many a$$holes shorting the stock.

The stock isn't doing the company justice, I agree. But "highly respected company" is a stretch.

I hope so. At least we won't have to hear about the stock price anymore from every ANALyst out there.

The stock price really is a moot point. I find it hard to believe that RIM's board members or the CEO Thorsten Heins cry themselves to sleep over it. It is only a reflection of how the market feels towards RIM and it is highly inaccurate of RIM's actual value. The stock isn't going to change any time soon so I doubt they are freaking out about it. However they will make the decisions needed to stop the mutiny of the stock whether that be going private or doing their best to win back the media and the very fickle consumer. I personally would rather see them tough it out because once BB10 is released at a decent time and has the "WOW" factor than people will come around and the market will have to adjust.

I'm no expert by any means but, that is just my 0.02 Pesos

If RIM were to put an offer on its own shares, seeking to go private, it would accomplish atleast two things:

1) if their are other parties interested in RIM it would draw them out and create a possible bidding war

2) it would put a floor on the stock which would be considerably higher than what it is right now

Does RIM have enough cash in hand to buy back all its stock??

Originally Posted by mawil1013

Does RIM have enough cash in hand to buy back all its stock??

Of course RIM doesn't have enough cash to buy back all of its stock. They have $2.1B on the BS and their market cap is more than double that. But that's not the point here.

The point here is that RIM would have to partner with an equity partner to go private. Someone like Silver Lake, Cerebrus, etc. Or they would have to issue debt (ie. bonds, debentures, etc).

RIM is stuck between a rock and a hard place. The competition has outgrown them, and this happened very quickly. If you look back this happened not only to Apple, but to IBM as well. We all know what happened to Apple and where they are now, but what happened to IBM?

IBM exited their consumer hardware business. Focused on software, and services and is now a thriving company once again. Changed business model, changed focus, spurred innovation and of course growth. But all of this came at a great cost, to the company, to their employees (Massive layoffs occurred), their consumer base. But this is a textbook example of how to save a company. I would have never thought that IBM would never make computers again when I was growing up. Just like I would of never thought that Sony would not make TVs. And now, what I have been saying for a while now, living in Waterloo for almost 20 years I would have never thought I would see RIM not make their BlackBerry smartphones.

But like I've said countless times here on CB, and many other forums. RIM needs to exit the hardware business. Lack of innovation, poor execution, lower margins, decreasing revenues, and increased competition has proved that RIM's hardware business is a money losing operation.

With the QNX acquisition, it is clear now that the focus is on software. And in addition, their services (which bring in approx $1B of revenue per quarter). RIM will once again thrive, and innovate and bring to the world the most revolutionary software platform, a ubiquitous software platform. But as it happened with IBM, this will spur many changes to how the company operates, how it looks and what it produces.

Thanks
@SurrealCivic

Originally Posted by BB10FTW

The stock price really is a moot point. I find it hard to believe that RIM's board members or the CEO Thorsten Heins cry themselves to sleep over it. It is only a reflection of how the market feels towards RIM and it is highly inaccurate of RIM's actual value. The stock isn't going to change any time soon so I doubt they are freaking out about it. However they will make the decisions needed to stop the mutiny of the stock whether that be going private or doing their best to win back the media and the very fickle consumer. I personally would rather see them tough it out because once BB10 is released at a decent time and has the "WOW" factor than people will come around and the market will have to adjust.

I'm no expert by any means but, that is just my 0.02 Pesos

It really isn't a moot point. It is the driver behind the "vicious circle" that RIM finds itself in. The press coverage is about poor performing stock, which leads to press coverage about a company in decline which leads to people not buying product which leads to poor stock performance and poor press coverage, etc...

If they were private they could very, very quietly go about their business until BB10 comes out and not have to worry about "activist" investors calling the press to spread rumors about trouble.

I'm not saying in any way that this is the only reason for their issues (it's mind boggling they don't have a FFC with Skype at this point), but it is a massive, massive reason for it. Whenever I hear people discuss RIM these days it's in the context of "I heard on the news they're going bankrupt", which couldn't be further from the truth (they're increasing their cash balance). Being public is crippling them right now.

***A public company cannot take itself private by buying its shares with its cash because all its assets belong to the shareholders, not the company!**

I repeat: The company belongs to the shareholders!

Whether the company is forced to liquidate, or be acquired, or a consortium buys out a majority of shares to take the company private - it has to be voted on, passed, and approved at a shareholder meeting.

Way too many people on this board toss out that "take it private" as if is just a cake walk. Remember, that means that if for example you own shares in RIM that you paid $10/s and a majority forces through the motion to take it private at 45c/s, you *have* to sell your shares to the new owners.

People in the stock market are too far up apples doo doo hole

Sent from my BlackBerry 9800 using CrackBerry forums application

@jonty12 - I understand that the stock is important but, seeing as how it is simply not going to get better until something big happens it is IMO a moot point. Going private doesn't seem like a great idea because then people surely will believe that RIM is finished. If RIM stays public and makes the come back with BB10 that everyone is hoping for then RIM's stock will have to go up. I didn't want to make it sound like the stock wasn't important but, due to the "vicious circle" as you put it, it certainly isn't going to change until bb10 launches or some other major annoucement happens. It is just my opinion that the stock is a pointless discussion.