Potential suitors for BlackBerry manufacturer increase as share price plummets.
It has emerged that a number of potential suitors have considered bids for RIM as the beleaguered BlackBerry maker’s woes continue.
RIM’s share price has tumbled in recent months as a series of disappointing results and product delays have sparked speculation about a possible breakup of the company.
According to Reuters, Amazon hired an investment bank in the summer to evaluate a possible takeover of RIM, but it never made a formal offer and it remains unclear if it proposed a price. Amazon has recently made moves into the mobile market with the launch of its commercially successful Kindle Fire.
It has also emerged that recent bedfellows Microsoft and Nokia discussed a joint bid but it appears that talks never went beyond the initial stage.
RIM was reportedly hostile to any such advances and wants to fix its problems independently. The company hopes to achieve this through the release of new phones, better use of assets such as BlackBerry Messenger (BBM) and restructuring.
However, it has been pointed out that any acquisition of RIM would not only involve taking over the production of handsets, but would also necessitate the preservation of BlackBerry’s encryption services, while others have questioned the wisdom of buying the company while it is experiencing problems refreshing its software and hardware.
Speculation about a buyout is likely to intensify as long as RIM’s problems persist and it is rumoured that some potential buyers are waiting for the Canadian manufacturer’s share price to drop even further.
Last week, RIM reported lower than expected third quarter revenues and announced that its co-CEO’s salaries would be reduced to one dollar as a result. Reported revenues of £3.5bn were up 24 percent by the previous quarter, but down by six percent from the same quarter last year, while net income fell 71 percent year-on-year to £171m.
RIM’s share price dropped still further after it was suggested earlier this week that BlackBerry’s next generation of smartphones running the new BlackBerry 10 operating system would be delayed until late 2012, hindering the company’s chance of reviving its fortunes.
The smartphones and new operating system were considered to be vital to RIM’s recovery and it was hoped they would recover lost market share to rival Android and iOS devices.
The news was the latest in a series of incidents which affected the company in 2011. The BlackBerry Playbook tablet produced disappointing sales figures while RIM’s reputation suffered substantial damage when users worldwide lost access to BlackBerry data services in October. The company wasn’t even able to call its new operating system ‘BBX’ after another company claiming to own the trademark won a court injunction which forced RIM to rename it to ‘Blackberry 10 OS’.