According to the letter of intent agreement signed by Blackberry, a consortium will be held by Fairfax Financial Holdings Limited under which it will offer to acquire the company subject to due meticulousness as stated in the agreement. 10% of Blackberry’s common market shares are already in the hands of Fairfax. As stated in the letter of intent Blackberry shareholders will get 9 USD in cash for every share they hold. The total transaction values close to 4.7 Billion USD.
Blackberry was one a very dominant company in the mobile devices arena. However, it is now going through a rather rough phase and is gradually losing to its rival companies, such as Google and Apple, that manufacture Android enabled devices.
Earlier this year, Blackberry launched a new OS named BB10. It also unveiled two new smartphones named Q5 and Z10 that will be functioning on the newly launched operating system. However, BB10 has not been as successful in evoking response from the customer. Blackberry also declared that its Blackberry Messenger, popularly known as BBM, will now be available on iOS and Android platforms, too. Many believe that it was a step taken to regain control over its losses.
This consortium led by Fairfax will acquire for cash all the outstanding market shares of Blackberry that are not owned by Fairfax. It is planning to contribute its part of the shares into the transaction. The Board of Directors of Blackberry have approved the terms of the letter of intent. It is likely that the diligence will be complete by 4th of November, 2013. During this period, blackberry can scout for other prospects; however, it will be required to pay a fee for termination.