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BlackBerry to go private in $4.7 billion deal
24 September 2013
BlackBerry has reached a preliminary deal with one of its biggest shareholders to take the company private for about $4.7 billion, reports The Wall Street Journal.
Fairfax Financial Holdings, a Canadian
insurance firm, has signed a letter of intent with the
BlackBerry board under which it could pay $9 a share in cash
for the 90% of BlackBerry shares it doesn't already own.
The deal is far from complete. It
is subject to six weeks of due diligence, and BlackBerry can
attempt to sell the company during that period. Fairfax would
still have to arrange financing.
The agreement also doesn't compel
Fairfax to ultimately come forward with a firm offer,
underscoring the weak negotiating position BlackBerry is in.
BlackBerry, on the other hand, would have to pay a breakup fee
of more than $150 million if it turns to another buyer by 4
"We thought, every day that goes
by, if the position of the company wasn't stabilised they would
lose employees and customers, and we thought it was appropriate
to do the deal [now]," said Fairfax chairman and chief
executive Prem Watsa. GTB