How much is BlackBerry worth? By the numbers

How much is BlackBerry worth? By the numbers

Summary: Break out the estimates, the analyst notes, and the calculators. BlackBerry could be worth far more if broken up and sold off in parts.

TOPICS: BlackBerry
(Image: CNET)

BlackBerry may be ripe for breaking up and picking apart than being sold off to a competitor or rival as a whole company, analysts believe. 

Earlier this month, BlackBerry's board formed a special committee to determine whether or not it should seek joint ventures or sell off certain key assets, or if it should split up and sell off to the highest bidder. It's part of efforts to both plow on with its BlackBerry 10 efforts while reducing costs over time. 

Bloomberg broke out the analyst notes and broke down some of the company's costs.

In short, we have a "breakup" scenario as more likely because as a whole, the company isn't worth as much as if it were split up and sold along in parts. In effect, it could be the same kind of fate that Nortel, another Ontario, Canada-based company, fell to some years ago.

Handset business

BlackBerry has a lot going for it. The one thing it doesn't have going in its favor is its smartphone business. Under a breakup scenario, it has zero value, according to Raymond James analysts.

Five alternative futures for BlackBerry

Five alternative futures for BlackBerry

Five alternative futures for BlackBerry

Its competitors are doing far better in this space, with Windows Phone overtaking BlackBerry in the crucial third-place spot in market share rankings. And, BlackBerry's corporate and enterprise appeal rests on its data network that offers military-grade encrypted communications.

A total wind-down of the division could cost the company about $800 million, or $1.50 per share, according to BMO analyst Tim Long.

Enterprise data infrastructure

According to the Bloomberg piece, IBM made an "informal approach" to buy out BlackBerry's enterprise data infrastructure in 2012, but not the whole company. It follows similar rumors that Samsung (which later denied any such claims) and Lenovo (which said it probably wouldn't either) were reportedly interested in the company's handset business. 

Should the company spin out its enterprise data network, the U.S. government — and other allied nations — will want to keep BlackBerry's infrastructure out of Chinese hands. With 72 million smartphone subscribers at the end of June, down from about 80 million in 2012, its secure messaging network could still be worth about $1.2 billion.

Cash reserves

BlackBerry's cash pile has stayed relatively steady over the past year. Instead of dipping into its cash reserves, BlackBerry has cut staff and other resources in a bid to preserve its balance sheet. 

The company ended the first quarter with $3.1 billion in cash and investments, a 7 percent increase from the previous quarter. BMO analysts peg the current total to be about $2.8 billion. BlackBerry has not issued debt, and has enough in its reserves to stave off bankruptcy for at least a year.

Patents and intellectual property

MDB Capital chief executive Chris Marlett said in recent weeks that the company is the "last big and current [wireless] portfolio available," which could help secure the firm a good-looking price tag for its stash of about 9,000 patents.

Competing firms, which include Microsoft, Google, Apple, and Samsung, could pay up to $5 billion for the firm if it were bought by a single firm, Marlett said, or between $2-3 billion if it were acquired by a consortium. This can be compared to Nortel, whose assets fetched $7.8 billion for its creditors at its bankruptcy auction in 2009.

In total, what's BlackBerry worth?

By the end of this year, BlackBerry's cash pile may be as low as $2.6 billion. Also, consider patents and intellectual at between $1 billion apiece, or $4 billion in total; the enterprise data network worth about $1.2 billion to the highest bidder; and additional software at $1.5 billion. But, minus the $800 million estimated figure of shuttering its handset business.

In total, the company could be worth between $5.5 billion, or $10.50 per share, or as much as $8.5 billion broken up.

(via Bloomberg)

Topic: BlackBerry

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  • They should stay the course and keep improving.

    Independent research has shown that companies often bail too soon. OS 10 is very nice and it is getting better. The developer eco-system, tools, libraries is improving.

    Blackberry has an inside track to the automotive industry via QNX. There are synergies there. They are still catching up with the smartphone hardware but they are not far behind. Apps keep coming.

    And in the enterprise they have a solid management offering for Apple, Android and Blackberry.

    As long as they have the cash. They can keep operating. Patience, Patience
    • I was expecting that

      But they are giving signs that they are giving up.
      They spent about 1 year preparing the launch of BB10, and all they released was a full touch device and a one with a keyboard - none of them with specs to match the competition.
      Nokia is still in deep trouble, but they've done a great job releasing a complete set of windows devices.
      I once had hope on BB, but with just 2 devices they have no chance to get number 3 position. Even Apple that is Apple is struggling to maintain share with such a short device offer.
    • It's shareholder's money to blow

      It is up to shareholders whether they want to cash out now or maybe lose everything if they continue to "believe" in the company.

      There is surely a market niche for a physical keyboard "email phone". Nokia already had a successful E series, they don't need any of the BB stuff to make a good WP8 email phone.
      • theres an idea.

        Be the niche physical keyboard phone company. All the other manufacturers seem to just put out a qwerty pad that isn't really designed with functionality in mind -- more of a "check yeah we offer a physical keyboard phone"

        of course then that would mean developing them for all different OS's which would likely not be worth the cost
  • 1.2B for the data infrastructure are you joking

    Most of those 72M users have long since paid BB the last dollar they ever will. With the Z10/Q10 fiascos now ending any and all future comeback hopes forever those users will be moving on to other platforms at an even quicker pace now.
    Johnny Vegas
  • MS will purchase BB for $6+ billion, and send it off to Nokia ina full

    partnership agreement, to share IP and to keep the data network in operation. BB's devices will get support for about 2 years, but with the stipulation that they'll have to convert to WP8 devices in those 2 years.

    Speculation? MS cannot afford to allow BB to go to the competition.
    • Do anyone needs that now?

      Microsoft has enough patents, they don't need more, Apple the same, maybe Google too with Motorola.
      The idea of MS offering BB to Nokia it's a bit too much.
      But that's for sure a possibility, even if I bet in a Chinese maker to buy it.
      • Hopefully it will be a US company

        The patents and encryption tech is not something you want the Chinese government to have access to.
        • What if I was Chinese?! :-P

          I'm not, but I don't think there are much technology you can hide from Chinese.... or others.
      • It's not about having "enough" patents; it's about having the important

        patents, and BB has a lot of important patents, and they won't be broken up into important and less important, so, it's one big package of patents, or none.

        What I mentioned is not MS offering BB to Nokia; what I said MS taking BB and partnering with Nokia to share patents and co-develop products and services, with those patents serving as foundations.
        • Not going to happen

          It's becoming less and less likely.
    • on that last line

      he may have a point. Grab up BB and now those 5 million in sales are MS, putting them half way to catching apple on a raw numbers game.

      Of course thats likely too simplistic, nobody on BB10 would want to convert to WP8. so it would be one company running 2 incompatible mobile OS's.
  • There are other possibilities

    I could see an Indian consortium or a Brazilian group buying up Blackberry. Those countries could see it as a way to have there own complete ecosystem out of US hands.
    • hmm.

      worked for fiat and chrysler