Microsoft Rumored To Acquire Blackberry For $7 Billion

Omar Sohail
Posted May 25, 2015
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Earlier this week, it was reported that there were several tech companies interested in acquiring Canadian telecommunication firm Blackberry. Out of Xiaomi, Huawei, Lenovo, and Microsoft, the last two firms have the highest chances of acquiring Blackberry given the fact that they have had some experience in making expensive acquisitions. Now, rumor has it that software giant Microsoft intends on snaring Blackberry for the price of $7 billion USD. The amount is slightly lower compared to the $7.17 billion USD that the company gave away in acquiring Nokia, and $500 million USD less in contrast to the rumored offer of Samsung, which took place in January. Later, Blackberry had denied that Samsung had approached the firm with the aforementioned deal.

Microsoft Will Gain Access To Blackberry Patents, Including IoT, IoV And Mobile Enterprise Security If Rumor Turns Out To Be True

According to Mobile Burn and The Next Rex, before rumors circulating around Microsoft and Samsung, it was Chinese tech firm Lenovo who made a bid to acquire the company for $1 billion USD. If the rumor does turn out to be true, then it would increase the total share price of Blackberry to $13.23, from $10.48 (Friday closed details of stock exchange). That is a stock price increase of 26 percent, something that Blackberry would be keen to look forward to. In our earlier reports, Microsoft had hired investment bankers from Goldman Sachs and Deutsche Bank to evaluate the company’s position.

Additionally, acquiring Blackberry would give Microsoft access to the company’s patents, including mobile enterprise security, which is a necessary addition to preserve smartphone security with the proliferation of mobile devices across the globe. Furthermore, the software giant would also be given patents belonging to IoT and IoV (internet of vehicles).

During 2013, BlackBerry’s largest shareholder, Fairfax Financial, had agreed to take the company private in a $4.7 billion deal. Unfortunately, the deal did not come to fruition; thanks to the removal of Thorsten Heins as CEO. Heins was eventually replaced by John Chen, who is most certainly battling out a bunch of quandaries on whether or not the company should be acquired. During 2014, Blackberry had reported a loss of $5.9 billion USD, an abysmal feat for a multinational firm.

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Perhaps the best course of action for the telecommunication company would be to accept the offer, assuming Microsoft has pitched one.

Image source: The Guardian

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