BlackBerry 'warming' to idea of a breakup, sell-off

Summary:The beleaguered phone maker may not be able to find funding or partners for a $4.7 billion buyout, amid concerns there's no way for the company to bounce back.

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Image: CNET

Concerned that it cannot drum up the funding to buy its way out from the public stock market, BlackBerry is reportedly increasingly "more open" to the idea of a breakup.

The news comes from Bloomberg, which citing sources familiar with the matter, said companies including Cisco, SAP, and Samsung, have indicated their interest in the company — but only parts of it. 

Splitting up the firm and selling it on would help the company generate the most money back to shareholders, which have invested millions — if not more — into the Waterloo, Ontario-based company. From its assets list, BlackBerry's patents alone are expected to fetch a solid billion dollars, while its enterprise data network could also be sold on to the highest bidder.

It comes just a couple of months after BlackBerry said it was exploring the possibility of being sold off .

The company reported  a $965 million loss  in September following a massive inventory charge as a result of the poor sales of its Z10 smartphone. The smartphone maker only a week before announced it would cut 40 percent of its staff base as it continues to eat away at its vast cash reserves.

During the quarter, BlackBerry dipped form $3.1 billion in cash to $2.6 billion.

A consortium led by Fairfax Financial offered to buy the company for $4.7 billion , days after issuing a profit warning. That price alone concerned investors. As my ZDNet colleague Andrew Nusca explained, Apple made more money in its first weekend selling the iPhone 5c and 5s than BlackBerry will sell for.

BlackBerry has until November 4 to consider alternative proposals, Bloomberg reports.

Late September, research firm Gartner said BlackBerry had "no more than six months" to consider and implement changes to its company structure and strategy, and recommended its users should seek alternatives. BlackBerry subsequently rebuffed the comments, saying they were "speculative."

Topics: BlackBerry

About

Zack Whittaker writes for ZDNet, CNET, and CBS News. He is based in New York City.

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