With BlackBerry Ltd. (NASDAQ:BBRY) and potential suitors facing a key deadline Monday, its co-founders Douglas Fregin and Mihal “Mike” Lazaridis may bid for the mobile-device manufacturer in conjunction with the private-equity firm Cerberus Capital Management L.P. and the mobile-phone chip-maker Qualcomm Inc. (NASDAQ:QCOM), according to multiple media outlets.
Fregin and Lazaridis co-founded the firm formerly known as Research In Motion Ltd. in 1984, but they have not been employed recently as executives of the struggling smartphone maker based in Waterloo, Ontario.
The BlackBerry co-founders have been talking with Cerberus and Qualcomm about making a joint bid for the company by the deadline Monday, The Wall Street Journal reported, citing people familiar with the matter.
BlackBerry announced in August it would “explore strategic alternatives to enhance value and increase scale in order to accelerate BlackBerry 10 deployment. These alternatives could include, among others, possible joint ventures, strategic partnerships or alliances, a sale of the company or other possible transactions.”
With BlackBerry thus put in play, a consortium led by Fairfax Financial Holdings Ltd. (TSE:FFH), the company’s largest investor, reached a tentative agreement the following month to purchase the smartphone maker for about $4.7 billion, or $9 per share. However, Fairfax neither identified its consortium partners nor showed that it had the financing in place to seal the deal. The financial-services holding company delivered a fairly gruesome financial report for its third quarter Friday, leading some analysts to question whether it will have the wherewithal to complete the posited transaction.
Under the tentative agreement, BlackBerry said in September: “Diligence is expected to be complete by November 4, 2013 … The parties’ intention is to negotiate and execute a definitive transaction agreement by such date. During such period, BlackBerry is permitted to actively solicit, receive, evaluate and potentially enter into negotiations with parties that offer alternative proposals.”
Bloomberg News reported the Fairfax-led consortium had not finalized the financing by Friday, citing sources with knowledge of the matter. Fairfax’s advisers, the Bank of America Corp. (NYSE:BAC) and Bank of Montreal (NYSE:BMO), had been rebuffed by other lenders they contacted to help finance a bid, those sources said.