Market Overview

Cerberus Reviewing Financials and Considering a Bid for Blackberry

Cerberus Capital Management LP signed a nondisclosure agreement with Blackberry (NASDAQ: BBRY) to gain access to the company's financial information.

The private-equity firm will use the financials to formulate a bid to acquire all of Blackberry.

After a 45 percent hit in sales and $965M loss last quarter, Blackberry put itself up for sale in August. On September 23, Blackberry's largest shareholder, Fairfax Financial Holdings Ltd., made a tentative offer to buy the company for $4.7B equivalent to $9 per share. There have been concerns over this bid as shares are currently trading below the offered price at $8.19.

Blackberry co-founders Mike Lazaridis, who created the Blackberry phone, and Douglas Fregin signed an agreement to work together with Goldman Sachs Group and Centerview Partners LLC on a potential takeover offer on October 10. Last week, Reuters reported that BlackBerry was talking with Cisco (NASDAQ: CSCO), Google (NASDAQ: GOOG) and SAP (NYSE: SAP) regarding this sale.

An anonymous Cerberus employee (due to private deliberations) stated that they see Blackberry as a turnaround business and are considering purchasing the smartphone company as a whole. Cerberus may choose not to proceed, as the firm is still in the early stages of offering a deal.

Cerberus manages more than $20B in assets. The firm has expertise working with financially troubled companies. Cerberus took over almost 80 percent of Chrysler in 2007 and led a group to acquire grocery chains from Supervalu (NYSE: SVU) in early 2013.

Posted-In: Cerberus Capital Management LP Chrysler Douglas FreginNews M&A Best of Benzinga

 

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