RIM turned down multiple takeover bids despite financial woes

Posted:
in General Discussion edited January 2014
Research in Motion reportedly turned down offers from Amazon and other potential buyers, and is opting to fix its own problems by leveraging upcoming BlackBerry handsets and existing services.



Citing unnamed sources close to the matter, the Chicago Tribune reports that the embattled BlackBerry maker has turned down takeover offers by Amazon.com and others, choosing to look internally to remedy ongoing losses and a plummeting stock price.



In the last year, RIM has seen a dramatic drop in market value with stock prices falling 77 percent after failed handset launches, poor quarterly earnings and overall weak sales. A previous report noted that the company is now worth less than the estimated value of Apple's App Store.



The Canadian company's decline comes at a time when the worldwide smartphone market is picking up steam with record sales of Apple's iPhone and devices running Google's Android OS leading the way.



According to the sources, RIM is looking to its co-chief executives Mike Lazaridis and Jim Balsillie to halt the company's free-fall by launching new phones, expanding and strengthening assets like BlackBerry Messenger and restructuring. The company could make licensing deals and partnerships, however an outright sale or joint venture are not seen as viable options at this stage.



"They have had approaches from folks who have wanted to have discussions," said one head of technology investment banking at a Wall Street bank. "The issue is it is hard to find a value that makes sense with a falling knife."



RIM Corporate office in Waterloo, Ontario | Source: RIM



Amazon hired an investment bank to put together a merger offer this summer, but the internet sales giant fell short of making an official offer. The two companies are still looking to expand services like last year's service to offer Amazon's music catalog to BlackBerry users.



Although some are calling for the sale of RIM, as a whole or in parts, the BlackBerry maker has made it clear that they do not want to sell or break up the company at this juncture, the sources told Reuters. Following a weak earnings call last week, the board reportedly told Lazaridis and Balsillie to shelve and options for a sale.



"Selling the company or an economic joint venture is probably not in the cards right now," the source said. "Until you stabilize the platform, people are going to be very nervous about spending $10 billion or more."



RIM has suffered some setbacks recently with the newest BlackBerry 10 phones being delayed, poor sales of the company's PlayBook tablet and service outages in the EMEIA region (Europe, Middle East, India and Africa). The ongoing issues would make it difficult for Wall Street bankers to find a buyer even if RIM was interested in selling.



Earlier this year, RIM was pitched to other mobile phone makers like HTC and Samsung, but the companies already have licensing agreements with Google's Android and did not see any value in purchasing the ailing BlackBerry maker.
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Comments

  • Reply 1 of 73
    solipsismxsolipsismx Posts: 19,566member
    Makes sense Amazon would be up for RiM considering their KIndle Fire is based on PlayBook engineering.
  • Reply 2 of 73
    RIM doesn't want to see all their hard engineering work go to Amazon? I now have respect for them.
  • Reply 3 of 73
    Tough, tough, tough! It's hard to see such a successful company in such dire straights. I feel for the employees and their families.



    Can't help thinking back to when Steve introduced the iPhone 6 mo.'s before its release and the RIM engineers did not believe he was telling the truth about the iPhone's capabilities.



    How ironic, "Research In Motion!" their very namesake and they didn't do what Steve said...to be successful in tech u have innovate till ur 10 years ahead of everyone else.



    7 years ago, I used to play tennis with the CEO of best western hotels and between games he would be checking his email on his BB and then he would get a phone call and it looked like he was holding a cheeseburger up to his ear! Ugh!
  • Reply 4 of 73
    Quote:
    Originally Posted by mdriftmeyer View Post


    RIM doesn't want to see all their hard engineering work go to Amazon? I now have respect for them.



    Well said.
  • Reply 5 of 73
    Kudos to RIM for going down honorably.



    ?



    Weren't they the ones that were rumored to be buying Apple in '96?
  • Reply 6 of 73
    Now we know how stupid they are.
  • Reply 7 of 73
    Sounds more like they tried to sell before, and gave up after no one was interested:



    "Earlier this year, RIM was pitched to other mobile phone makers like HTC and Samsung, but the companies already have licensing agreements with Google's Android and did not see any value in purchasing the ailing BlackBerry maker. "



    "Amazon hired an investment bank to put together a merger offer this summer, but the internet sales giant fell short of making an official offer. "
  • Reply 8 of 73
    sflocalsflocal Posts: 4,078member
    Good for RIM!! That's showing some gusto! Just like when Microsoft tried to buy Yahoo a few years back for serious billions! Now look how good Yahoo is doing!!



    Oh... wait... never mind... </sarcasm>
  • Reply 9 of 73
    solipsismxsolipsismx Posts: 19,566member
    Quote:
    Originally Posted by DougDolde View Post


    Now we know how stupid they are.



    That depends on what was offered.
  • Reply 10 of 73
    Amazon might actually be a pretty good fit for RIM... as sick as that makes me feel. I'm sure they could pull off an all-stock offer that would be accepted. RIM needs something... and just cutting the two heads off won't get them nearly far enough. Just think... they have lost over 90% of the value since the 2008 peak.
  • Reply 11 of 73
    tundraboytundraboy Posts: 1,568member
    Quote:
    Originally Posted by AppleInsider View Post




    RIM is looking to its co-chief executives Mike Lazaridis and Jim Balsillie to halt the company's free-fall. . .



    That's the big, glaring flaw in their recovery plan.
  • Reply 12 of 73
    tylerk36tylerk36 Posts: 1,037member
    They had the chance to compete. The just watched Steve produce. They sat on their hands and watched and convinced themselves that they had the superior product. They did and they are goon become the company that couldn't.
  • Reply 13 of 73
    quinneyquinney Posts: 2,501member
    Quote:
    Originally Posted by AppleInsider View Post


    Citing unnamed sources close to the matter, the Chicago Tribune reports that the embattled BlackBerry maker has turned down takeover offers by Amazon.com and others, choosing to look internally to remedy ongoing losses and a plummeting stock price.



    Is embattled better or worse than beleaguered?
  • Reply 14 of 73
    Quote:
    Originally Posted by Tallest Skil View Post


    Kudos to RIM for going down honorably.



    ?



    Weren't they the ones that were rumored to be buying Apple in '96?



    What the? Go down... "honorably"?



    This is business, not Braveheart.
  • Reply 15 of 73
    Thieves Make Off With 5,200 PlayBooks, RIM Confirms



    A group of thieves made off with a truck carrying about 5,200 BlackBerry PlayBooks in Canada last week, Research in Motion confirmed Tuesday. The semi-trailer headed for Ontario reportedly was carrying merchandise with a retail value of between $1.7 million and $5 million.



    http://www.pcmag.com/article2/0,2817,2397881,00.asp





    Have at er boys!
  • Reply 16 of 73
    Quote:
    Originally Posted by Icaras View Post


    What the? Go down... "honorably"?



    This is business, not Braveheart.



    They had their shot, they failed to change. They've done some great research, they don't want it getting in the hands of people who won't use it for any practical purpose.



    That's something to respect.
  • Reply 17 of 73
    Why do we not like Amazon around here?
  • Reply 18 of 73
    melgrossmelgross Posts: 30,348member
    Quote:
    Originally Posted by SolipsismX View Post


    Makes sense Amazon would be up for RiM considering their KIndle Fire is based on PlayBook engineering.



    That's not important, as apparently RIM didn't design the hardware.



    RIM has two things of value.



    One is the BES server. But that's increasingly less important as security gets better for other phones. iOS is considered to be second to RIM in that. Right now businesses are buying more iPhones than BBs'. Android is doing very well there too, and their security isn't all that great.



    So if business isn't as concerned about security, that devalues RIM's solution, especially considering the failures they've had over the years with it.



    Two is BBM. The message service has been a big advantage in a number of countries because it's free to BB users to other BB users. But with iMessage, Apple has a big competitor, because they are selling many more phones, and so it can be more widely used. Google and MS are working on similar services.



    The only other advantage is that their phones cost less, but Android phones cost less too. And now, so do iPhones.



    Amazon was smart not to get involved. It would be cheaper to develop their own phones, the way they did with their Kindles. Using outside expertise, they've made their job easier, and still maintain control.



    Really, what can RIM offer?
  • Reply 19 of 73
    melgrossmelgross Posts: 30,348member
    Quote:
    Originally Posted by quinney View Post


    Is embattled better or worse than beleaguered?



    Better.
  • Reply 20 of 73
    melgrossmelgross Posts: 30,348member
    Quote:
    Originally Posted by triggs View Post


    Why do we not like Amazon around here?



    I like Amazon!
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