Blackberry Shares Soar Despite Rumors of Privatization

Amidst rumors that Blackberry, a Canadian based mobile phone company, is going to be privatized, the shares rose to 5% in New York. The management concurred that their new-found strategy might prove to be effective in terms of solving the company’s issues regarding smartphone sales.

Fixing the problem

Thorsten Heins, CEO of Blackberry, together with the company’s Board is carefully devising a solution that would somehow put the company back on track and resolve problems that the embattled mobile phone company is currently dealing with.

Blackberry is not really doing well in terms of sales and marketing since it cannot directly compete with its rivals. The release of the Z10, the newest smartphone of the company, was supposedly the crowning glory of the brand. However, actual sales and customer patronage fell short of their very high expectations. Reports reveal that the company sustained a total loss of 20% this year. In 2008, Blackberry was valued at $84 billion, when it was at its peak. Today, the Canadian mobile phone company is on a staggering $4.8 billion valuation.

Privatization?

With the yearly loss the company is continually sustaining, the management came up with the idea to privatize all the shares. The reasoning behind this idea is to resolve internal problems. Privatization is also deemed as a means to another end – to properly manage organizational disputes without getting too much attention from the public and the media. However, reliable sources state that the said privatization plan is still on shaky ground. Sources added that there is still no decision with regard to the sales method and finalizing any deals is not yet in sight.

There are still factors to consider for a successful privatization plan. Since the company is losing assets it should be able to find a partner (or partners) willing to shell out millions if not billions of dollars to acquire every share. Blackberry has a huge number of shareholders to think about.

Blackberry’s smart (phone) move

Blackberry smartphones once dominated the mobile phone industry especially with its signature QWERTY keyboard and touchpad functionality. It was once among the most sought out mobile phone providers amongst consumers. However, since the touch screen revolution changed the way consumers use their mobile phones, the company suffered big losses as it failed to compete with companies like Apple and Samsung.

In order to prove to the world that Blackberry is still running the race, the company released its latest and most high-tech smartphone, the Z10 and Q10. The Z10 was built to rival iPhone 5 and the Samsung’s S4. The company had very high hopes for the Z10 when it was released in January. Sadly, sales failed to reach target levels.

On the defensive

Despite the current struggle Blackberry is facing, the Z10 and Q10 have given quite an impression on the US Department of Defense. Both models were commissioned by the Department of Defense and given the authority to operate within defense networks of this government facility. As of today, it is the first mobile defense management source to ever obtain such an approval.