Cerberus emerges as takeover rival for Fairfax in attempts to buy Blackberry

by Andrew Roach on October 3, 2013

Considering the links that are shared between Fairfax and Blackberry, it would seem as if the two firms would be the ideal combination for a possible takeover of the smartphone manufacturer.

But it seems that Prem Watsa might not get everything his own way as reports have emerged of an American investment company who are keen to place a bid for Blackberry.

Private investment firm Cerberus Capital Management have been named by the Wall Street Journal as a possible second
bidder for the Waterloo based company with the New York based investment firm thought to be analysing the financial status of Blackberry before going any further.

It comes as Blackberry’s worsening finances continue to blight the company with news that they may face losing another $400m in charges related to job cuts at their HQ.

The new surrounding a possible Cerberus bid will certainly surprise many thinking that Fairfax were a mere certainty to takeover Blackberry considering their former ties to the smartphone manufacturer.

However, Cerberus has emerged as a second contender and are currently creating a confidentiality agreement with Blackberry in terms to discuss and assess their poor financial shape.

Cerberus is a firm who specialises in distressed investing and could certainly use their expertise to help Blackberry plug the drain that has seen the company lose nearly $1.5bn already in 2013.

At the moment, there hasn’t been any comment from Cerberus about their connections to Blackberry however the smartphone manufacturer did issue a brief statement playing down any talks about another bidder. After the news was first reported, a spokesman for the company stated: “We do not intend to disclose further developments with the respect to the process until we approve a specific transaction or otherwise conclude the review of strategic alternatives.”

However, as the takeover speculation rumbles on, Blackberry will be keen to get everything sorted as soon as possible as they face losing another $400 million over the next few months.

These huge losses come thanks to the massive redundancies going on throughout the company where nearly 40% of will be cut over the rest of the year.

It seems as if Blackberry’s future is getting bleaker by the week and the company will need to be taken over as soon as possible by the likes of Fairfax or Cerberus if we are to see them survive over the next year or two.

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Written by: Andrew Roach www.digitcom.ca. Follow TheTelecomBlog.com by: RSS, Twitter, Facebook, or YouTube

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