Blackberry Cutting 4500 Jobs (40% of workforce)

[chemgear]

Demand would have been pretty low anyhow, but it certainly doesn't help the BB cause.

http://www.calgaryherald.com/busines...963/story.html

BlackBerry says its latest smartphone will arrive in Canada later this month, but it won’t have the support of one of the country’s largest carriers.

The smartphone maker says Rogers Communications has decided not to stock the new BlackBerry Z30, a touch-screen model similar in size to a Samsung Galaxy 4, when it’s released on Oct. 15 at various Canadian retailers.

[Anduril]

That's extra tough especially considering how we're talking about a Canadian company here dropping support for another one. I'm sure that Rogers doesn't give much weight into the Canadian link but public perception of BB takes an even larger hit compared to a random international or even American company deciding to not carry the next BB10 device.

[Slava]

Came here to post the same thing actually. I have to think that when Rogers won't carry it then things are bleak. I presume they declined because they don't think they can sell enough and don't want to subsidize them?

[chemgear]

http://business.financialpost.com/20..._lsa=1168-6575

The trading gap also may reflect concern that Fairfax will lower its bid given the company’s deteriorating prospects, said Michael Walkley, an analyst at Canaccord Genuity.

“The most likely outcome for BlackBerry is a sale to Fairfax Financial and its partners at a lower price of US$7 post further diligence,” he said in a note this week.

[Senator Clay Davis]

Hmmm, I'd be pissed if I was a shareholder.

BlackBerry Ltd is abandoning a plan to sell itself and instead will replace its chief executive officer and raise about $1 billion from institutional investors, including its largest shareholder, the smartphone maker said on Monday.

Shares of BlackBerry dropped 19 percent to $6.33 in premarket trading. The company will raise the money with a private placement of convertible debentures.

BlackBerry's largest shareholder, Fairfax Financial Holdings Ltd, will take up $250 million of the debentures.

Fairfax announced a tentative $9-a-share offer for the Waterloo, Ontario-based company in late September. But Reuters said on Friday that Fairfax was struggling to finance the $4.7 billion bid

http://finance.yahoo.com/news/blackb...133129601.html

I still seriously doubt the long-term viability of Blackberry, but I guess they don't.

[nfotiu]

Originally Posted by Senator Clay Davis

Hmmm, I'd be pissed if I was a shareholder.



http://finance.yahoo.com/news/blackb...133129601.html

I still seriously doubt the long-term viability of Blackberry, but I guess they don't.

Why would you be pissed? Sounds more like no one wants to buy them.

It also seems that the most profitable thing to do is to wind down operations and cash out.

[psicodude]

Yeah, I think Blackberry stating that they are "abandoning a plan to sell" is really putting a positive spin on things. It's probably more accurate to say that Fairfax either can't come up with the capital or took a look at the books and ran for the hills. There obviously isn't another offer on the table, so they are left with no other choice.

It will be sad to watch them wither and die slowly.

[nfotiu]

I kind of wonder what fairfax is thinking here by putting in more cash. I don't know how someone in aposition to control that much cash could possibly envision the company breaking out of their death spiral now.

[chemgear]

Wasn't sure to put this here or in the Stocks thread. Oh well:

http://www.bloomberg.com/news/2013-1...buying-it.html

BlackBerry Was Just Kidding About Someone Buying It

You have to admire BlackBerry's tireless efforts to put a brave face on things. In September, after announcing disastrous earnings and firing a third of its employees, BlackBerry had the bright idea of telling everyone that Fairfax Financial Holdings was going to buy it at $9 a share. That was sort of in the ballpark of maybe being kinda true, but it depended on Fairfax (1) getting financing and (2) not coming to its senses. Fairfax had until today to come to its senses and guess what?

BlackBerry Ltd. abandoned plans to sell itself and began searching for a new chief executive officer after a $4.7 billion takeover plan collapsed, sending shares of the struggling smartphone maker plunging.

Fairfax Financial Holdings Ltd., BlackBerry’s largest investor, walked away from its bid for the company, opting instead for a $1 billion bond deal and a management shakeup.

So instead of stumping up $4.7 billion in its own and others' money to buy BlackBerry, taking all of the equity upside and downside and controlling the company, Fairfax will stump up $1 billion of its own and others' money -- only $250 million of its own -- to take a lot of the equity upside, little or none of the downside, and basically control the company. That is a much better deal for Fairfax: It gets most of the benefit of buying BlackBerry, with considerably less of the risk.

Instead of raising $4.7 billion to buy the company, Fairfax is raising $1 billion -- only $250 million of which is its own money, the rest coming from co-investors -- to buy into the company in a senior position. Fairfax will still get equity upside above $10, the conversion price of the bonds, but it's ahead of the common shareholders if BlackBerry ever goes bankrupt which, I mean, you know, at some point that is a thing you might want to talk about.