BlackBerry announced in a press release on Monday that the Waterloo-based smartphone manufacture is now exploring strategic alternatives through a recently formed “special committee,” which could potentially result the sale of the company.
The alternatives that BlackBerry is exploring could result in a possible joint venture, strategic partnerships or the sale of the company.
This strategic review that BlackBerry is implementing had a direct impact on its shares with an approximately seven per cent rise in the pre-market trade, closing at $10.05 on Friday. In addition, there has been speculation that the company may go private which may delist BlackBerry’s stock if major investors buy up other shareholders.
But with this new formal review also brought a major shakeup for BlackBerry’s board. Fairfax Financials CEO Prem Watsa, one of BlackBerry’s largest shareholders who joined the board in 2012, stepped down from the board Monday due to “potential conflicts.”
“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 in statement released on BlackBerry’s website.
The special committee conducting the strategic review of the company includes Barbara Stymiest, BlackBerry CEO Thorsten Heins, Richard Lynch and Bert Nordberg and Timothy Dattels acting as the committee’s chair.
“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,” Dattels said in a statement.
“As the special committee focuses on exploring alternatives, we will be continuing with our strategy of reducing cost, driving efficiency and accelerating the deployment of BES 10,” Heins said in the same statement.
The process will have JP Morgan Securities act as the financial advisor to the smartphone company. The statement released noted that the company does “not currently intend to disclose further developments with respect to this process, unless and until its board of directors approves a specific transaction or otherwise concludes the review of strategic alternatives.”