Qualcomm Considering Entering BlackBerry Bid
posted Saturday Nov 2, 2013 by Scott Ertz
Six weeks ago rumors began to circulate about another bidder for BlackBerry, led by founder Mike Lazaridis. Since then, the plans seem to have gotten more detailed. The addition of co-founder Doug Fregin brings the current holdings of the equity group to 8%, making a buyout a little easier. Adding Cerberus Capital Management, a private equity firm, into the mix brings guaranteed money to the table.
At this point, the only thing missing from the group is a company already in the wireless space with enough money to prop up BlackBerry until it can get a new direction firmed up and an ability to execute. That is where Qualcomm comes into the picture. In Qualcomm comes an ability to deal with the exit of Jabil Circuit, who has manufactured BlackBerry handsets for years, by providing manufacturing and component relationships.
With an easier path to takeover, enough money to make the purchase and an increased ability to pivot and execute, this bid could be the one that wins and ends an extremely messy auction. The only question is, is it possible for this group to make an effective pivot that will not alienate Qualcomm's other business interests.
In being a major supplier of processors for smartphones of several categories, including Android and Windows Phone, Qualcomm has a lot of potential to lose business if suddenly they become competition against the platforms they support. On the other hand, Google purchasing Motorola or Microsoft purchasing Nokia has not discouraged either ecosystem, nor has Samsung's dominance prevented them from supplying screens to Apple.
So, is it possible to turn BlackBerry around under new management, or is the company worth less than the sum of its parts? Let us know your thoughts in the comments section.
