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BlackBerry Could Be An M&A Target For These 10 Companies

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BlackBerry Could Be An M&A Target For These 10 Companies

BlackBerry Ltd (NASDAQ: BBRY) proved to be a profitable company in the fourth quarter, with an EPS of $0.05. It's an important step forward for the company, which is in the midst of a turnaround.

Now that BlackBerry has returned to profitability (compared to its previous year's position), investors might wonder if the firm is still a takeover target. That answer is as cloudy now as it was two years ago. But if BlackBerry is going to be acquired, these companies might be the most likely to initiate an M&A:

1. Microsoft

Sean Udall, CIO of Quantum Trading Strategies and author of The TechStrat Report, told Benzinga that Microsoft Corporation (NASDAQ: MSFT) would probably be the "best buyer" for BlackBerry. He thinks the Windows maker would help the BlackBerry OS rise by allowing other handset makers to license the highly secure operating system.

"I think Microsoft's better strategy would be to buy BlackBerry," he said. "They'd inherit security and a secure network. I think, in that scenario, it's hard for me to get to a BlackBerry that doesn't at least trade in the $20s."

Udall said that BlackBerry management might think the company is better on its own, hoping that the company can return to growth.

"And if they can start growing, they may be better off on their own," he added. "I do think there's a relatively decent probability, let's call it 50 percent or greater, that a fair number of people would be interested in buying BlackBerry – especially if they can get the right price."

Related Link: Apple Needn't Worry About Samsung's "Totally Useless" Acquisition

2. Tata

Rob Enderle, principal analyst at Enderle Group, doubts that any traditional device maker will merge with BlackBerry. Instead, he thinks that an automaker is more likely to be interested in what BlackBerry has to offer.

"The overwhelming advantage they've got is with automotive," said Enderle. "If a car company wanted to kind of corner the market for this technology and kick everybody else in the butt, certainly an automotive company acquiring BlackBerry would give them a hell of an edge."

Enderle said that Tata Motors Limited (ADR) (NYSE: TTM) would be "really interesting," because the firm is "on an acquisition run."

"And I don't think India is a huge concern for Canada," he said of the acquisition prospects. "Any acquisition has got to come from a country that Canada feels is acceptable because BlackBerry is so ensconced, not only as a Canadian resource but it's so heavily [tied] to the Canadian government as a platform. The U.S government is a heavy user of BlackBerry as well. They probably have to at least bless it to a certain extent."

Related Link: BlackBerry Q4 Conference Call: A Play-By-Play Recap

3. Amazon

In addition to Microsoft, Udall thinks that Amazon.com, Inc. (NASDAQ: AMZN) could be a potential suitor "if they wanted to have an OS and license it."

"Almost any of the large Android makers could be a potential bidder," said Udall. "If you have Amazon buy BlackBerry and then license the BlackBerry OS and run their secure network, I think it'd be a home run deal.

"I think Amazon would run it really, really well. They run their data services division super, super well. That's been a huge boon for the company. I think they could get the [BlackBerry] platform growing fairly decently again."

4. Ford

Enderle doubts that an auto industry stalwart is likely to buy BlackBerry, though he did say that Ford Motor Company (NYSE: F) is a "possibility" after the two firms worked together on Sync 3.

"I just haven't seen Ford very aggressive in terms of acquisitions of late, let alone a software platform," said Enderle. "I think it's going to have to be one of the newer companies. My money would go toward Tata."

5. IBM

Could International Business Machines Corp. (NYSE: IBM) – a company that sold its consumer PC business to Lenovo Group Limited (ADR) (OTC: LNVGY) – acquire BlackBerry?

"Put it this way: anybody that wants a secure wireless network could buy BlackBerry," said Udall. "And that could be an asset for almost any large enterprise company to have."

Related Link: Why Investors Might Want To Be Wary Of Betting Against BlackBerry

6. NVIDIA

Five years ago, NVIDIA Corporation (NASDAQ: NVDA) was mostly known for building high-end graphics cards for PC gamers and power users. Today, the company is trying to diversify into other areas, especially after the firm turned down a deal to provide graphics cards for Sony Corp (ADR) (NYSE: SNE)'s PlayStation 4.

"NVIDIA might be another firm that would do this, 'cause they're making a huge play for automotive infrastructure," said Enderle. "The platform would give them a huge edge in their automotive move."

Enderle suggested that investors should keep an eye on both NVIDIA and Tata.

"Both companies are aggressive," he said. "Both companies have a desire to corner certain parts of the automotive market. They're trying to do very creative things in the segment."

7. Oracle

Oracle Corporation (NYSE: ORCL) is another company on Udall's list of possible suitors.

"That's getting a little fanciful, but anything's possible," he said.

8. Samsung

Udall didn't have much to say about SAMSUNG ELECT LTD(F) (OTC: SSNLF), but he thinks it is another likely buyer.

Related Link: BlackBerry Posts Q4 Profit, But Revenue Misses

9. Symantec

Udall also made the case for how Symantec Corporation (NASDAQ: SYMC) could acquire BlackBerry.

"It wouldn't be that odd of a deal to get one of these aging security companies that needs to do a deal," he said. "Maybe they can't buy FireEye because they're too expensive. They certainly can't buy Palo Alto 'cause they're too expensive. Maybe they don't want to buy Cyberark because it's too young and it's an Israeli company and they can't get that deal done. So what are they gonna do? They still have to grow."

10. HTC

HTC CORP SP GDR REGS (OTC: HTCKF) rounded out Udall's list.

"They do make Windows phones," he said. "They tend to be the one that takes chances."

Udall noted that HTC developed the first Facebook-branded smartphone. He said, at one point HTC was the No. 1 Android seller globally.

"HTC probably has to do something relatively soon or they're not gonna be in the phone business," Udall concluded.

Disclosure: At the time of this writing, Louis Bedigian had no position in the equities mentioned in this report.

Image Credit: Public Domain

 

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