BlackBerry exploring 'strategic alternatives' including sale
BlackBerry (NASDAQ:BBRY) said its board of directors has formed a special committee to explore strategic alternatives including a possible sale as the manufacturer mounts a last-ditch bid to accelerate deployment of its struggling BlackBerry 10 operating system.
The special committee includes BlackBerry CEO Thorsten Heins alongside board members Timothy Dattels, Richard Lynch, Bert Nordberg and Barbara Stymiest. Prem Watsa, Chairman and CEO of Fairfax Financial--BlackBerry's largest shareholder--resigned from the board due to potential conflicts that may arise during the exploration process: "I continue to be a strong supporter of the company, the board and management as they move forward during this process, and Fairfax Financial has no current intention of selling its shares," Watsa said. Financial services provider JPMorgan and legal firms Skadden, Arps and Torys are advising the process.
"Given the importance and strength of our technology, and the evolving industry and competitive landscape, we believe that now is the right time to explore strategic alternatives," said Dattels, who will chair the special committee. Heins added that while the committee mulls its options, the device maker will continue efforts to drive adoption of BlackBerry 10 smartphones, concurrently rolling out its multi-platform BlackBerry Messenger social chat service and pursuing mobile computing opportunities leveraging its BlackBerry Global Data Network.
Formation of the special committee follows days after digital research firm comScore reported that BlackBerry plummeted to 4.4 percent U.S. smartphone market share during the second quarter of 2013, down from 5.2 percent at the end of the first quarter. The decline was especially troubling given that BlackBerry rolled out its new Z10 and Q10 smartphones during the second quarter, suggesting that the fledgling BlackBerry 10 has done little to divert consumer attention away from Google's (NASDAQ:GOOG) Android and Apple's (NASDAQ:AAPL) iOS. "I'm confident in the future of BB10, but there's lots of work to do," Heins said during the company's quarterly conference call in June.
BlackBerry (formerly Research In Motion) first unveiled the overhauled BlackBerry 10 in late January. Four months later, the company announced plans to expand BlackBerry Messenger to Android and iOS, a move to rekindle consumer interest in its brand and combat a new generation of cross-platform, over-the-top messaging services like WhatsApp, Kik Messenger and Viber. BlackBerry also has revealed it is in negotiations with competing manufacturers to offer BBM as a preinstalled application on their phones.
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