Restructuring charges worth $400 million are needed by BlackBerry Ltd (NASDAQ:BBRY); these charges are four times its value. BlackBerry in its regulatory filing said that this amount is equal to laying off almost 4,500 employees. This is the exact reason for BlackBerry’s firing policy according to which the company fired almost 40% of the staff; it also sold many of its equipment. This is not all; BlackBerry also plans to unpack its factories and property. The company also needs to compromise some of its productive services that basically support corporate customers’ wireless devices. Steven Li, an analyst at Raymond James Ltd believes that despite all these measure, BlackBerry will face difficulty in acquiring its breaking-even point.
Not many investors are excited about BlackBerry’s stocks because its stock price is going down than the offer price for its shares. The private equity company, Cerberus Capital Management LP, however, seems interested in BlackBerry. It is expected that a confidential agreement will be signed between the two companies about some important financial components. According to the Wall Street Journal, Cerberus’ interest in BlackBerry might just prevent BlackBerry from a very possible bidding process.
BlackBerry’s restructuring costs are increasing and it seems highly unlikely that the company will regain its lost glory because budget measures being taken just don’t seem enough. It is also rumored that BlackBerry might get out of its business of wireless services and stop manufacturing phones. Therefore, it should not come as a surprise if BlackBerry handsets stop coming in the market soon.
In the afterhours trading shares of BlackBerry Ltd (NASDAQ:BBRY) went up by 0.13% ($7.97).