DEALTALK-Watsa to hold keys to a BlackBerry deal

Wed Aug 14, 2013 2:59am EDT
 
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By Euan Rocha and Greg Roumeliotis

TORONTO/NEW YORK Aug 14 (Reuters) - BlackBerry Ltd is expected to draw preliminary interest from technology companies, buyout firms and Canadian pension funds, but its fate may ultimately rest in the hands of its largest shareholder, Prem Watsa's Fairfax Financial Holdings Ltd .

Any serious bidder would likely be hoping to get Watsa, the Fairfax founder and chairman who is often called Canada's answer to billionaire U.S. investor Warren Buffett, on their side, because he could join in on a private equity deal or at the very least be the bellwether for broader investment sentiment.

"I would imagine that if Fairfax says they are against a particular deal, that would carry a lot of weight, beyond just the 10 percent that they control," said Richard Steinberg, who heads Fasken Martineau's securities and mergers & acquisitions group in Toronto.

Although it remains too early to tell determined buyers from window-shoppers, sources familiar with the situation said some of the world's largest private equity firms, including Bain Capital LLC, KKR & Co LP and Carlyle Group LP, are expected to look at BlackBerry when the company launches a sale process.

Leo De Bever, the chief executive of Alberta Investment Management Corp, said he expected some of the largest Canadian pension funds, including his own, to look at any potential deals for the company.

Analysts said firms ranging from established mobile phone players like Apple Inc and Samsung Electronics Co to technology giants like Amazon.com Inc, Facebook Inc, Cisco Systems Inc, Hewlett-Packard Co and IBM Corp, may also be drawn to the beleaguered smartphone maker's assets such as patents or its network or instant messaging platforms.

Watsa stepped down from the BlackBerry board on Monday, citing a potential conflict of interest, as the company said it was exploring the sale of itself and other options.

Jefferies analysts have suggested that Fairfax could team up with Canadian pension funds and banks to take BlackBerry private, possibly for $15 per share.   Continued...