BlackBerry shares rally as investors eye property sale windfall
TORONTO Jan 22 (Reuters) - Shares of BlackBerry Ltd , which have been on a tear this year, rallied again on Wednesday as investors eyed a revenue windfall from the technology company's plans to sell its Canadian real estate assets.
The Waterloo, Ontario-based company said on Tuesday it plans to divest most of the property it owns in Canada to bolster its balance sheet.
BlackBerry shares surged 8 percent to $10.73 on Wednesday afternoon on Nasdaq, while the Toronto-listed stock rose 8.8 percent to C$11.84.
BlackBerry's stock has been by far the best performer on the Toronto Stock Exchange's top 60 index so far this year, having risen 50 percent. The next biggest gain belongs to Valeant Pharmaceuticals International Inc, which is up almost 22 percent. The index itself is up just 2.5 percent year-to-date.
Analysts estimate that the real estate asset sale will raise a sizable amount of cash for BlackBerry, which is attempting to reinvent itself under the leadership of its new chief executive, John Chen.
"Based on our estimates using Waterloo, Ontario, per square foot prices, we conservatively estimate that the company could bring in roughly $600 million to $700 million from the sale," Wells Fargo analyst Maynard Um said in a note to clients.
The company did not disclose how much it plans to raise from the sale process. The properties comprise more than 3 million square feet of office space.
($1=$1.10 Canadian) (Reporting by Euan Rocha and Alastair Sharp; Editing by Peter Galloway)
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