BlackBerry Ltd (NASDAQ:BBRY) Plans to Lobby the Government of Canada regarding Foreign-Takeover
BlackBerry Ltd (NASDAQ:BBRY) plans to lobby the government of Canada regarding the matter of foreign-takeover and the concern of the investors that possibility of BlackBerry’s domestic takeover doesn’t exist. According to federal documents for lobbying, BlackBerry has scheduled a meeting with lawmakers in hopes to carry out discussions on the Investment Canada Act; the Act has rules regarding foreign buyouts of domestic or local companies; according to the Act, any bid over C$344 million gets automatically analyzed by the Canadian government.
This drive resulted due to speculations regarding Fairfax Financial Holdings Ltd. (TSE:FFH) of Toronto that BlackBerry’s largest shareholder, Fairfax had to face difficulty in putting together a bid for the company. However a reliable source says that Fairfax is in the process of negotiations with manager of Canadian Pension Funds to produce substantial support for some BlackBerry deal; the success in this regard is yet to come. Default credit trading in swap believes that investors aren’t sure whether Fairfax will make such an effort.
As per lobbying register, BlackBerry executives announced its meeting with government officials and lawmakers regarding the Investment Canada Act during last week. The possibility of selling the company was brought into discussion by the company’s Special Committee Board after the operating system BlackBerry 10’s makeover failed to make an impact. The sales of smartphones powered by BlackBerry 10 in the quarter of May were less by a figure of 1 million than the number anticipated by analysts, resulting in a loss. It is expected that BlackBerry’s report of the latest quarter will also show a loss in sales.
In order to focus on its latest devices, BlackBerry moved a portion of its staff to the United States and also made cuts on the company’s labor force. A spokesman for Ontario-based BlackBerry, Adam Emery reported that BlackBerry let go of 60 jobs for the same purpose. According to Emery, this relocation to the US is done with the aim to focus on BlackBerry’s important customers in the United States because the company’s June earnings showed a decline of 24% in stocks.
In the premarket, shares of BlackBerry Ltd (NASDAQ:BBRY) went up by 0.55% ($11.00).