NEWS Canada Pension Fund Investment Board and the Caisse de Depot intend to invest in BBRY
OTTAWA CITIZEN MAGAZINE
Don’t count BlackBerry out yet
BY L. IAN MACDONALD, OTTAWA CITIZEN AUGUST 20, 2013 5:02 PM
BlackBerry has struck a committee to conduct a strategic review of its options. One of them is taking the company private, where it wouldn't have the bother of quarterly earnings calls.
One potential buyer is Fairfax Financial Holdings, which owns nearly 10 per cent of the company. The investment company is controlled by Prem Watsa of Toronto, who resigned from BlackBerry’s board last week to avoid any conflict of interest. Both the Canada Pension Fund Investment Board and the Caisse de Depot, through its CEO Michael Sabia, have expressed interest in investing in BlackBerry should it go private.
But any sale of BlackBerry to a foreign buyer would have to be approved by Industry Canada through Investment Canada. Microsoft has been said to consider bidding on BlackBerry in the past, and the smart phone segment might be a good fit.
A Chinese company, such as tech and telecom giants Huawei or ZTE, is another possibility. But any sale to China would be problematic for the Canadian and U.S. governments, given the importance of BlackBerry’s security features.
And that’s not about whether a sale of BlackBerry meets the significant benefit test of Investment Canada. It’s about national security, and rises to a much higher threshold of approval.
BlackBerry has put itself in play, but at this point no one knows whether it will be taken private or possibly sold to a foreign company.
One thing is for sure, the company that created the smart phone, the pride of Canadian high-tech, has fallen on difficult times.
And the question is, what can the federal government do to help?
If BlackBerry CEO Thorsten Heins were having this conversation with Industry Minister James Moore, he would probably say something like: “Just give us the flexibility to make the right decision for the company, the industry and the country.”
That’s a pretty good message. The government’s role should be to help BlackBerry find a way through this, and help keep the company whole rather than broken up for its $3 billion in cash, its patents and its R&D.
Canadians have a certain amount of pride in BlackBerry, which has brought enormous value added to the Canadian brand in nearly 180 countries worldwide.
It’s not as if we have a lot of world champions in this country. You can pretty much count the others on the fingers of one hand. Bombardier in aviation and rail transport. CAE in flight simulators and training. Barrick Gold in mining. Peerless in men’s clothing. And in financial services, the Big Five Canadian banks, all in the Top 10 in North America in market capitalization and assets.