March 28, 2024
BlackBerry Signs Letter of Intent to Be Acquired By Fairfax for $4.7 Billion

BlackBerry Signs Letter of Intent to Be Acquired By Fairfax for $4.7 Billion

Posted September 23, 2013 at 6:36pm by iClarified
BlackBerry has received a buyout offer of $4.7 billion from Fairfax Financial Holdings Limited.

The company signed a letter of intent agreement to an acquisition for $9/share. Diligence on the acquisition is expected to be complete by November 4th. During this period, BlackBerry is permitted to actively solicit, receive, evaluate and potentially enter into negotiations with parties that offer alternative proposals.

BlackBerry lost nearly $1 billion last quarter and is planning to cut 4500 jobs.


The full press release announcing the deal can be read below.


-----
BlackBerry today announced it has signed a letter of intent agreement ("LOI") under which a consortium to be led by Fairfax Financial Holdings Limited ("Fairfax") has offered to acquire the company subject to due diligence.

The letter of intent contemplates a transaction in which BlackBerry shareholders would receive U.S. $9 in cash for each share of BlackBerry share 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.

The BlackBerry Board of Directors, acting on the recommendation of a special committee of the board of directors (the "Special Committee"), approved the terms of the LOI under which the consortium, which is seeking financing from BofA Merrill Lynch and BMO Capital Markets, would acquire BlackBerry and take the company private subject to a number of conditions, including due diligence, negotiation and execution of a definitive agreement (the "Definitive Agreement") and customary regulatory approvals.


The Special Committee, chaired by Director Tim Dattels, was formed in August 2013 to review strategic alternatives for the company. J.P. Morgan and Perella Weinberg are acting as financial advisors and Skadden, Arps, Slate, Meagher & Flom LLP and Torys LLP are acting as legal advisors.

Diligence is expected to be complete by November 4, 2013 ("Diligence Period"). The parties' intention is to negotiate and execute a definitive transaction agreement by such date. During such period, BlackBerry is permitted to actively solicit, receive, evaluate and potentially enter into negotiations with parties that offer alternative proposals ("Alternative Transactions").

If (A) during the Diligence Period (i) BlackBerry enters into any letter of intent or definitive agreement providing for an Alternative Transaction, (ii) BlackBerry ceases to negotiate with the consortium in good faith with a view to entering into the Definitive Agreement by the end of the Diligence Period, or (iii) an Alternative Transaction is publicly proposed or publicly announced and is consummated within 6 months following the end of the Diligence Period, or (B) during the 3 month period following the end of the Diligence Period, BlackBerry enters into any agreement providing for an Alternative Transaction with a person with whom discussions were held before or during the Diligence Period, then BlackBerry shall pay Fairfax a fee of U.S. $0.30 per BlackBerry share, provided, however, that no such fee shall be payable if the consortium shall have reduced the price offered below U.S. $9.00 per share without the approval of the board of directors of BlackBerry. In the event that a definitive agreement is signed with Fairfax the termination fee will increase to U.S. $ 0.50 per share.

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."

Prem Watsa, Chairman and CEO of Fairfax, said: "We believe this transaction will open an exciting new private chapter for BlackBerry, its customers, carriers and employees. 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."

In addition to the consortium and its lenders being satisfied with all aspects of the due diligence to be carried out by them during the Diligence Period and the negotiation and execution of a binding definitive agreement approved by the board of BlackBerry, completion of the transaction will be subject to other customary conditions, including receipt of required regulatory approvals. There can be no assurance that due diligence will be satisfactory, that financing will be obtained, that a definitive agreement will be entered into or that the transaction will be consummated.

BDT & Company, LLC, BofA Merrill Lynch and BMO Capital Markets are acting as financial advisors, and Shearman & Sterling LLP and McCarthy Tetrault LLP are acting as legal advisors to Fairfax in connection with the transaction.
---


BlackBerry Signs Letter of Intent to Be Acquired By Fairfax for $4.7 Billion
Add Comment
Would you like to be notified when someone replies or adds a new comment?
Yes (All Threads)
Yes (This Thread Only)
No
iClarified Icon
Notifications
Would you like to be notified when we post a new Apple news article or tutorial?
Yes
No
Comments (4)
You must login or register to add a comment...
Simon
Simon - September 23, 2013 at 9:00pm
Why would anyone want to buy BB? Let alone for $4.7B??????
plumbgray
plumbgray - September 23, 2013 at 7:52pm
"Real world= eat or be eaten." ..... Or thats what they would like us to think?
Slasher
Slasher - September 23, 2013 at 7:25pm
Although I didn't like blackberry products, I don't really want to see them be 'eaten' :/
prostovanka
prostovanka - September 23, 2013 at 6:51pm
Real world= eat or be eaten.
Recent. Read the latest Apple News.
RECENT
Tutorials. Help is here.
TUTORIALS
Where to Download macOS Sonoma
AppleTV Firmware Download Locations
Where to Download macOS Ventura
Where To Download iPad Firmware Files From
Where To Download iPhone Firmware Files From
Deals. Save on Apple devices and accessories.
DEALS