BlackBerry Ltd shares surged on Tuesday on reports that the smartphone company is considering putting itself up on sale. Speculations on how much the company could fetch were stoked on another set of reports that the company's largest shareholder could take it private.
The struggling smartphone maker said Monday it will consider selling itself. Canada's Globe and Mail newspaper, citing unidentified people familiar with the matter, reported that BlackBerry's largest investor, Prem Watsa, is exploring ways to put together a group to acquire the company.
Watsa, the founder of insurance company Fairfax Financial Holdings, is one of Canada's best-known value investors. He has a 9.9 per cent stake in BlackBerry and is resigning from the Canadian company's board "due to potential conflicts that may arise during the process" of a strategic review.
That's given rise to speculation that he will make a bid for BlackBerry.
THE BIG PICTURE:
The BlackBerry, pioneered in 1999, had been the dominant smartphone for on-the-go business people and other consumers before Apple debuted the iPhone in 2007. In the years since, BlackBerry Ltd has been hammered by competition from the iPhone as well as Android-based rivals.
In January, the company unveiled new phones running a revamped operating system called BlackBerry 10 designed to better compete.
But its market share continues to lag. IDC said last week BlackBerry has fallen to fourth place in global smartphone sales, now trailing Microsoft. BlackBerry also warned in June of future losses.
The company's US-traded shares increased 81 cents, or 7.5 per cent, to $11.59 in afternoon trading Tuesday. The stock had dropped 9 per cent this year.