Monday, October 20, 2014
BlackBerry shares jump on rumour of China's Lenovo takeover
CBC News Posted: Oct 20, 2014
Shares in Waterloo, Ont.-based BlackBerry jumped by more than six per cent on the Toronto Stock Exchange Monday after a published report suggested Chinese computer firm Lenovo was preparing to make a bid for all or part of the company.
BlackBerry shares were changing hands at $11.40 on the TSX Friday afternoon, up almost seven per cent from Friday's close. The catalyst appears to be a report from technology news website Benzinga that says — citing unnamed sources close to the negotiations — that Chinese computer company Lenovo is preparing to launch an offer for BlackBerry of about $15 per share as early as this week.
Lenovo, best known by consumers as the company that bought IBM's desktop business and turned it into the largest seller of computers on the globe, was interested in buying BlackBerry in 2013, but the deal fell apart when the latter approached the federal government to ask if it would approve such a transaction and received a resounding no on national security grounds.
Under federal rules, any purchase of a Canadian asset worth more than $331 million is subject to approval by Ottawa under Industry Canada rules, including the so-called "net benefit" test that requires the deal be deemed good for Canada's economy. It's the clause that was invoked when Ottawa stepped in to scuttle the foreign takeover of the Potash Corporation of Saskatchewan, which would have been the biggest takeover in Canadian history.
When approached for comment, a spokesperson for BlackBerry told CBC News the company does not comment on rumour and speculation.