Research In Motion Could be the Next IBM

Loading...
Loading...
Eight years ago, IBM
IBM
sold its personal computer business to Lenovo. In the years since, Lenovo has become the world's second-largest PC manufacturer behind Hewlett-Packard
HPQ
. For a brief time, Lenovo actually took the lead.
Now Lenovo hopes to imitate that success with its smartphone initiative. The company already produces a number of smartphones for Chinese consumers, but the firm has its eyes on the global market. Last year, Lenovo execs
laughed off
rumors that it would achieve its goals by acquiring Nokia
NOK
. While a Nokia buyout has been rumored for a number of firms, including Microsoft
MSFT
, Lenovo is the only one that publicly dismissed the acquisition. Now Lenovo has shared its intent to acquire BlackBerry maker Research In Motion
RIMM
-- if and when the right deal comes along. "We are looking at all opportunities -- RIM and many others," Wong Wai Ming, CFO of Lenovo, told
Bloomberg
Loading...
Loading...
. "We'll have no hesitation if the right opportunity comes along that could benefit us and shareholders." Nick Manning, a spokesman for Research In Motion, told the publication that his firm has "no update on our strategic review at this time." Research In Motion began its strategic review last spring. At the time, J.P. Morgan Securities
JPM
and RBC Capital Markets
were
"tasked to help us with the strategic review we referenced on our year-end financial results conference call and to evaluate the relative merits and feasibility of various financial strategies, including opportunities to leverage the BlackBerry platform through partnerships, licensing opportunities and strategic business model alternatives." Investors feared that this would mark the end of the company, which had repeatedly delayed the release of BlackBerry 10. Research In Motion persevered, however, as it persuaded Wall Street to buy into the company's future. The stock is already up 48 percent this year, adding to the 77 percent increase that occurred during the fourth quarter. Research In Motion's success is not all that different from Apple's
AAPL
success in 2011 and early 2012. During that period, investors happily and excitedly bought into Apple's future. These investments were inspired by a long line of popular products, including the iPod, iPhone and iPad. Even newer products like the MacBook Air showed promise. Thus, investors could not resist. Unlike Apple, Research In Motion's success (or failure) has yet to occur. The company could very well break records when BlackBerry 10 is released this quarter, justifying every investment that traders have made. The opposite could also occur, inspiring a massive selloff. Investors seem to be confident that the latter scenario will not occur. If Lenovo agrees, it may attempt to acquire Research In Motion in the near future with the hope that it will become the firm's next IBM.
Follow me @LouisBedigianBZ
Loading...
Loading...
Market News and Data brought to you by Benzinga APIs
Posted In: NewsM&ATechLenovoResearch in MotionWong Wai Ming
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!

Loading...