BlackBerry’s go-shop period may have attracted another suitor

It looks like Fairfax Financial Holdings may get some competition as it attempts to take BlackBerry private in a $4.7 billion deal, with reports emerging Wednesday that Cerberus Capital Management LP may launch a bid of its own.

According to a report from The Wall Street Journal, citing sources familiar with the matter, Cerberus has expressed interest and is looking to sign a confidentiality agreement to gain access to private financial information from BlackBerry. It doesn’t mean Cerberus will launch a rival bid, but it would gain access to information to help it judge the state of the company and decide whether or not to make a bid.

Neither BlackBerry or Cerberus have confirmed the report. In a statement provided to Reuters, BlackBerry declined comment.

“We do not intend to disclose further developments with the respect to the process until we approve a specific transaction or otherwise conclude the review of strategic alternatives,” a BlackBerry spokesman told Reuters.

The Fairfax offer, which is only a letter of intent that could be withdrawn after its own due diligence is completed, values BlackBerry at $9 a share. BlackBerry stock was still trading below that level on the TSX in afternoon trading Wednesday, although it was up by 1.10 per cent to $8.28 on the strength of the Cerberus report.

It’s not uncommon for companies, even rivals, to sniff around a company during a go-shop period, and sign a confidentiality agreement to gain access to private financials. During Dell’s go-private process, rivals HP and Lenovo took advantage of the go-shop period to get access to Dell’s books. Its unlikely either had serious designs on bidding for the company; they just wanted a peek under the curtain.

It will remain to be seen how serious Cerberus is, or what its intentions for BlackBerry would be should it launch a successful bid. Based in New York City, Cerberus specializes in distressed assets. Its leadership team includes former U.S. vice-president Dan Quayle. Its web site does not currently list any Canadian portfolio companies.

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Jeff Jedras
Jeff Jedras
A veteran technology and business journalist, Jeff Jedras began his career in technology journalism in the late 1990s, covering the booming (and later busting) Ottawa technology sector for Silicon Valley North and the Ottawa Business Journal, as well as everything from municipal politics to real estate. He later covered the technology scene in Vancouver before joining IT World Canada in Toronto in 2005, covering enterprise IT for ComputerWorld Canada. He would go on to cover the channel as an assistant editor with CDN. His writing has appeared in the Vancouver Sun, the Ottawa Citizen and a wide range of industry trade publications.

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