BlackBerry maker Research In Motion halted its stock two days back for about 15 minutes after the markets closed in order to issue a “business update” from company CEO Thorsten Heins to their stockholders, giving a preview of its Q1 earnings, which will be announced in full on June 28th. The bankers – including leading M&A specialists from Royal Bank of Canada and J.P. Morgan – will explore options as drastic as an outright sale, one of the alternatives that RIM seems determined to avoid.
But what big point is that analysts and investors having doubt that even with bankers on board to help the struggling company, RIM is running out of options. RIM’s market capitalization is now $5.5 billion, down from $84 billion at the company’s peak in 2008. It has $2 billion in cash, no debt and patents that experts say could be worth $2.5 billion.
“You are not going to sell RIM whole,” said Charter Equity analyst Edward Snyder, who has covered RIM since its Nasdaq initial public offering in 1999. “The biggest problem RIM faces is that it’s a very illiquid market in suitors for its phone business.” Added, “There’s very few companies that could exploit RIM’s (hardware) assets to make a go of it. Those who can are already beating the pants off RIM.”
BlackBerry maker is preparing for a major global restructuring which is going to start in next couple of weeks. The company is planning to lay-off at least 2,000 people across its worldwide operations.