RIM Valued at $9.6 Billion

By Thea Neuman (Google)

A recently surfaced Bloomberg report, hinting about an informal approach by IBM for buying RIM, has certainly set tongues wagging across the entire tech-world.

It appears as if RIM’s investors were just waiting for this kind of report. It has become a known fact that a couple of past activities did upset RIM’s investors and they had a difficult time in digesting the decision regarding delay of upcoming BB 10 smartphones models.

One of RIM’s investors Victor Alboini stated that this report has indeed made him happy, and if the final bidder turns out to be IBM, he would be even happier.

Alboini further stated on Friday that he is not at all surprised by finding that IBM has shown interest in acquiring RIM because that’s what caters to IBM’s main forte of services for business and enterprise software.

Alboini also revealed that his company began buying RIM’s shares in 2011 and they propelled New York-based investors like Omega Advisers of Leon Cooperman and Canada-based investor Prem Watsa, to buy shares of this Ontario-based tech enterprise.

He opined that original value of BB network of RIM lies in its huge subscribers base which accounts for 80 million people. These 80 million subscribers pay subscription on monthly basis for their BB smartphones and for the email services availed by them.

He also tried to make a wild guess regarding RIM’s value, and in his opinion, RIM’s value may be close to $9.6 billion which is just twice than its market capitalization that accounted for $4.1 billion at the closing of Thursday.

According to Peter Misek, an analyst with Jefferies, the approximate value of RIM may be close to $2bn. He further expressed his opinion that if an acquisition takes place then it would result in further downsizing of workforce and round about 80% employees of RIM may be affected from a lay-off procedure. That’s an alarming number.

Alboini expressed his apprehension stating that Fairfax Financial by Watsa which owns a stake of about 10% in RIM and Mike Lazaridis (Ex-co-CEO at RIM), who holds about 10% of RIM’s stake, may put some stumbling blocks in RIM’s acquisition.

RIM’s CEO, Thorsten Heins, is trying his best to keep his words that RIM won’t get split since he assured all investors of the company that RIM would be intact, during the annual general meeting on 10th of July this year.

In order to deliver his promise, Heins hired leading investment banks like JP Morgan Chase and Royal Bank of Canada.
Alboini also said that RIM’s manufacturing and product development business units may fetch the attention of leading players of tech-industry like Microsoft and Samsung. These two names have surfaced in former reports as well, which mentioned about the possibility of RIM’s acquisition by any of these two tech-giants.

RIM is nowhere even close to its arch rivals like Apple and Samsung who have been setting new milestones of success.

RIM’s shares have also been going downhill and in last 52 weeks, RIM’s shares have witnessed a plunge by 62%.

The current situation certainly doesn’t hold an optimistic picture for RIM but since RIM’s innovative BB 10 smart phones are yet to arrive in the market, the company would like to hope for the best.