Shares of China's Lenovo fall after report of BlackBerry bid
Shares of Chinese computer and phone maker Lenovo tumbled 1.71 percent Friday following a report it is mulling a counter bid to buy struggling Canadian smartphone maker BlackBerry.
The Wall Street Journal, citing unnamed sources close to the matter, said Lenovo had signed a confidentiality agreement to access BlackBerry's accounts.
If Lenovo did buy BlackBerry, the deal would be one of the biggest and highest-profile purchases of a Western company by a Chinese firm, the report said.
However, Lenovo's Hong Kong-listed shares fell on Friday, closing at HK$8.07. The company has declined to comment on the report.
"I just don't see a good logic," CLSA head of Asia Pacific technology research Nicolas Baratte said. "There is little value left in BlackBerry."
And Alberto Moel, an analyst at Sanford C. Bernstein, said: "If I were Lenovo, I wouldn't do it."
He added that given BlackBerry's rapidly declining market share, eroding client base and demoralised workforce, a deal would be far riskier and less beneficial than other acquisitions it has made in the past.
In August, BlackBerry said it was setting up a committee to decide whether to put itself up for sale or to pursue other options for the company, once a leader in the smartphone market but now in deep trouble.
Canadian investment fund Fairfax Financial, which owns 10.0 percent of BlackBerry, offered on September 23 to buy the rest of the business for $9.0 per share, valuing the company at $4.7 billion.
Last week, the founder of BlackBerry Mike Lazaridis said he was thinking about making a counter bid.
Lazaridis, who owns 5.7 percent of the shares, has reached an agreement with another founder of the firm, Canadian Douglas Fregin, to look at buying the shares they do not own. Together, they hold 8.0 percent of the capital.
© 2013 AFP
