BlackBerry has just announced that it will be taken private by a group led by Fairfax Financial Holdings.
After Friday’s devastating news that more than 35% of the company’s workforce is being let go, investor confidence in BlackBerry was oised to reach a new low. But moments ago, BlackBerry confirmed that it has signed a letter of consent that will pay shareholders $9 in cash for each share of BlackBerry they hold, in a transaction valued at approximately U.S. $4.7 billion.
The consortium would acquire for cash all of the outstanding shares of BlackBerry not held by Fairfax. Fairfax, which owns approximately 10 percent of BlackBerry’s common shares, intends to contribute the shares of BlackBerry it currently holds into the transaction.
Barbara Stymiest, Chair of BlackBerry’s Board of Directors, said: “The Special Committee is seeking the best available outcome for the Company’s constituents, including for shareholders. Importantly, the go-shop process provides an opportunity to determine if there are alternatives superior to the present proposal from the Fairfax consortium.”
Last week, BlackBerry cited the failure of the BlackBerry Z10 as being the primary reason for the news that close to 5,000 people will be losing their jobs.
“We believe this transaction will open an exciting new private chapter for BlackBerry, its customers, carriers and employees,” says Prem Watsa, Chairman and CEO of Fairfax. “We can deliver immediate value to shareholders, while we continue the execution of a long-term strategy in a private company with a focus on delivering superior and secure enterprise solutions to BlackBerry customers around the world.”