The Chief Executive of Fairfax Financial Holdings Ltd, Prem Wasta said yesterday that he is ‘confident’ the consortium he leads can find the money to fund their $4.7 billion bid for smartphone maker Blackberry Limited.
Watsa said in an interview “We wouldn’t put our name to such a high-profile deal if we didn’t feel confident that at the end of the day that our due diligence would be fine and we’d be able to finance it.”
The Canadian led consortium put in a $9 a share bid for BlackBerry on Monday – saying that the company would have better chances as a private entity. BlackBerry faced rising challenges in recent years from Apple and Samsung. Their new smartphone models received a lukewarm reception, especially as they ditched the physical keyboard from the models – one of their strongest selling points to a business user.
Watsa said “Short term these things fluctuate, there is speculation one way, there’s speculation the other way. We never pay too much attention to the marketplace.”
He added “BlackBerry is one of Canada’s great success stories. There is no question it’s fallen on hard times recently, but we have every confidence it will be successful again. We’re putting a consortium together to make sure that that takes place.”
Reuters say “Asked if the bid price could be reduced, Watsa said he didn’t expect that to happen unless the review of BlackBerry produced negative surprises. He said Fairfax had never changed the terms of a deal in 28 years.
Watsa declined to name any participants in the group, citing confidentiality agreements, or to comment on questions around possible collateral the group could use to secure financing, or on the possibility of bridge financing that could be repaid using BlackBerry’s existing cash pile.
He said the group did not include any strategic players, but that one or two technology companies could possibly join.”
Kitguru says: BlackBerry were once the great leaders in the smartphone sector. How times have changed.