Second bidder for BlackBerry? 'Distressed asset' investor Cerberus eyes company

Second bidder for BlackBerry? 'Distressed asset' investor Cerberus eyes company

Summary: Private equity firm Cerberus may be interested in bidding for BlackBerry, according to reports.

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BlackBerry Z30: Hands-on with BlackBerry's flagship phablet

BlackBerry Z30: Hands-on with BlackBerry's flagship phablet

BlackBerry Z30: Hands-on with BlackBerry's flagship phablet

US private equity firm Cerberus may be interested in bidding for BlackBerry, following the handset maker's preliminary $4.7bn buy-out agreement with Fairfax Financial Holdings.

Distressed asset specialist Cerberus wants access to BlackBerry's private financial information in what could lead to a counter offer for the troubled company, sources familiar with the matter told the Wall Street Journal

The company is not thought to be among those that BlackBerry approached when it first began looking into a sale earlier this year, the WSJ said.

Cerberus' rumoured interest follows a disappointing second quarter for BlackBerry, which last week reported a $965m loss for the period, driven by a significant writedown on unsold Z10 inventories.

Sales of its handsets outside the US in developing markets are being squeezed by competition from low-cost Android smartphones, while buyers are also being put off by the lack of apps for BlackBerry phones, the company wrote in a filing to the US Securities and Exchange Commission (SEC) published on Wednesday.

The news of a second suitor comes after a preliminary agreement the handset maker signed early last week with its largest shareholder Fairfax Financial Holdings. Fairfax is leading a consortium of unknown investors to acquire the company for $4.7bn, or $9 a share.

The pair are hoping to sign a definitive agreement with Fairfax by 4 November after due diligence. BlackBerry has an option to find other buyers if Fairfax lowers its offer to below $9 a share, but faces stiff financial penalties if the offer stays and it walks after this period.

More on BlackBerry

Topics: BlackBerry, Mobility, Smartphones

Liam Tung

About Liam Tung

Liam Tung is an Australian business technology journalist living a few too many Swedish miles north of Stockholm for his liking. He gained a bachelors degree in economics and arts (cultural studies) at Sydney's Macquarie University, but hacked (without Norse or malicious code for that matter) his way into a career as an enterprise tech, security and telecommunications journalist with ZDNet Australia. These days Liam is a full time freelance technology journalist who writes for several publications.

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6 comments
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  • Oracle will buy it

    Elli$$on can resist having his own phone when it is on the cheap.
    LlNUX Geek
    • LOL

      That's pretty funny, Ellison is still butt sore from purchasing his last hardware dog, I think he's learned his lesson. In addition the Java Albatross is going to kicking him in the gut for at least a decade assuming he can get it fixed anytime soon.
      greywolf7
  • Cerberus....?

    Isn't Cerberus the same outfit who, in concert with Mercedes Benz.., asset-stripped Chrysler.?
    amclpreston
    • Pretty much.

      Mercedes Benz went after what little gold was in Chrysler - namely the 2nd gen Viper platform (you can't tell me that a SLS AMG doesn't look EXACTLY like a Viper once you peel off the lipstick). Cerberus went after everything that was left and, instead of allowing designers to maybe get vehicles out there that looked good, ran well, and didn't feel cheap, they based designs and drivetrains off of nickel and dime decisions.
      Champ_Kind
    • Cerberus in Greek and Roman mythology is a multi-headed "hellhound"...

      ... which guards the gates of the underground, buys up distressed assets, squeezes out every dollar and then sells the remains to a witless buyer. Cerberus currently owns Steward Hospital Group, a MA chain of hospitals, mostly once run by Catholic charities, and in deep doo-doo. I can see it now. To pump up Blackberry, every employee of Steward will need one.
      ben_myers@...
  • Familiar...

    Cerberus is the company that owned Chrysler for a while
    TheMimic12