BlackBerry’s Valuable Patents Could Spark a Bidding War
BlackBerry has been struggling for years as other smartphone companies have been pushing it off the market. It is at a point where it is about to be bought off for around a mere $5 billion. However, an upside is that Blackberry’s patents are valued at $2-$3 billion. Chris Marlett, CEO of MDB Capital Group, an intellectual property focused investment bank, says that although there is little value for the company’s actual hardware business, its intellectual property value is substantial.
Fairfax, a Canadian insurance company, is Blackberry’s largest shareholder and has offered $4.7 billion to buy it out. However, Blackberry’s valuable patents may draw in other competitors such as Microsoft, which may force Fairfax to raise its offer. However, Marlett warns that BlackBerry’s patents are not as valuable and essential as they were even two years ago, when Apple and Microsoft bought Nortel’s patent portfolio for $4.5 billion and Google purchased Motorola Mobility. BlackBerry’s patents probably will not sell for as much as those patents did.
There are many potential buyers for the company, including Fairfax, Apple, Google, and BlackBerry co-founder and former CEO Mike Lazaridis. Analysts say both the BlackBerry company and its buyer should suit each other. William Blair analyst, Anil Doradla, says “BlackBerry is worth something only if a willing suitor can see the value.” Since BlackBerry has struggled, the buyer should have a vision to do something with the company that would bring it back on track.