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BlackBerry confirms possibility of sale

Smartphone pioneer acknowledges need to explore options

BlackBerry confirms possibility of sale
BlackBerry has shed over 90% of its $80bn peak market capitalisation.

Beleaguered smartphone maker BlackBerry yesterday said it had set up a special committee to explore its future options and that one possibility was the sale of the company, Reuters reported.

Prem Watsa, founder, chairman and CEO of Toronto-based Fairfax Financial Holdings has resigned from the board to avoid conflict of interest, as his company is BlackBerry’s largest shareholder. Watsa is now said to be exploring the option of taking BlackBerry private.

The Canadian company, formerly known as Research In Motion, was a smartphone pioneer, debuting a number of features and services, such as mobile access to email, that have since become standard among handsets. Its shares hit a peak of C$150 in 2008, when RIM had a market capitalisation in excess of $80bn. Today that figure is $5.4bn, but analysts say that BlackBerry’s assets, which include a popular messaging service and a number of patents, are worth well in excess of this.

Foreign competition has been fierce. US-based Apple Inc and South Korea’s Samsung Electronics dominate the handset industry and IDC second-quarter figures show a top five that does not feature BlackBerry and whose overall share of the market is growing.

Perhaps of greater concern to the Canadian company is the breakdown of the operating system market. Google’s Android has grown its share to 79.3% as of Q2 2013, according to IDC, and with Apple’s iOS swallowing a further 13.2%, this leaves meagre scraps for other vendors. BlackBerry OS’ share is 2.9% and the platform has even been overtaken by Microsoft’s much-maligned Windows Phone.

If BlackBerry opts for an outright sale, possible suitors include Microsoft, Amazon.com and China-based Lenovo Group. Any sale to a foreign entity would be subject to approval by the Canadian government.

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