Lenovo reportedly considers purchasing RIM’s hardware division

Daniel Bader

January 24, 2013 8:49 pm

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Lenovo is reportedly mulling over a purchase of RIM’s traditionally-unprofitable hardware division as it determines how best to move into the international smartphone and tablet market.

Lenovo is the world’s number two PC manufacturer, and although sales have been strong over the last few quarters, rocketing past Dell in market share, desktop and laptop sales are slowing in the wake of smartphones and tablet proliferation. Lenovo rose to be the number two smartphone maker in China in 2012, but it has a lot of work to do if it ever wants to be an international player.

RIM initiated a strategic review of its assets last year as it bled money, jobs and market share, but has since rebounded in many ways in the run-up to BlackBerry 10. The company has not commented on a potential acquisition, citing its focus on a successful launch of the new platform, but rumours swirled last year that IBM was considering purchasing its Enterprise business.

Analysts speculate that even if BlackBerry 10 proves a success for the company — which, if early indications are a bellwether, it likely will — RIM may choose to sell its hardware business anyway, focusing on its network and software assets. A partnership with a company like Lenovo or even Samsung, which was also rumoured to be interested in acquiring RIM at one point, could push the Waterloo-based outfit back into the black.

RIM’s CEO, Thorsten Heins, has repeatedly said that no option is off the table when it comes to recreating his company as a profitable venture. That includes licensing BlackBerry 10, selling its network or hardware assets or, although the least likely scenario, an outright purchase of the entire company.

The company was a better acquisition target in September, when the stock had fallen to $6 on the NASDAQ. Now, just under $18, RIM’s market cap, while still significantly lower than its 2008 high, is climbing. Lenovo is rumoured to be waiting until BlackBerry 10 hits consumers’ hands before making a decision.

Despite uncertainty around sales numbers, marketshare and stock price, the overarching feeling surrounding RIM and the launch of BlackBerry 10 is cautious optimism.

Via: Bloomberg

  • TZM

    Now this is a real *** RIM.

    • HAHAHA

      HAHA RIM IS DEAD! THEY’RE DEAD!

    • Priest Bob

      Let’s all have a moment for silence for RIM as they prep to be lowered into the ground 6 feet under.

      RIM, as we know it, is dead and pathetic.

      When the two buffoon CEO’s called iPhone a “toy”, it was all downhill.

      RIP RIM.

      RIP RIP

    • Lenovo

      Lenovo is the biggest PC maker in the world after HP (remember them?)
      Now that the PC is dead they are trying to diversify into other sectors. But still begs the question: Why??

      -This is just another Rumour from RIM’s PR department to take the stock as high as it can go before they announce the BB10 flagship phones in Mid March.

      -Lenovo REPORTEDLY considers purchasing RIM’s hardware division.

      -Reportedly is the key words, people. Remember: when you read an article about RIM you always have to see the source and read in between the lines.

    • Lenovo

      Think about it for two seconds:
      -Why didn’t Lenovo bought RIM when it was $6??

      -In a CLASSIC PR exercise Lenovo “leaks this rumour” and at the cost of NOTHING, BOTH Lenovo and RIM stock go up in price!

      -Welcome to spin-land!

    • Stupid

      ^
      Nice theory except that it was Lenovo’s CEO that spilled the beans about considering buying RIMM’s hardware division. Not RIMM. So maybe it’s Lenovo that’s trying to pump RIMM’s stock before they buy it. Oh wait…
      Best maybe you just don’t talk about stocks in public.

    • hoo dat

      Lenovo, this “rumour” didn’t come from RIM but from Lenovo themselves and was more of an aside than anything. That was it, nothing more.

      I love it when conspiratists get their panties in a knot.

  • Sweet

    Wow, I was pretty close. Last year I said that RIM would be a good fit for IBM. Given that Lenovo bought IBM’s PC business, I’ll claim that I was pretty close. :-)

    I’m not sure what to think of this deal. It depends on what Lenovo would do to the product and the Canadian jobs. I’ll wait for more info before I form my opinion.

    • wotzit2ya

      Exactly what they did with IBM , move everything to China ,screw employees

  • Sean

    I wonder how this would go over for governments that still use Blackberry devices. Remember the paranoia the US had with Huawei building cell towers.

  • Kid.Canada

    Does Lenovo even make phones? Why the sudden interest in the wireless industry? Doesn’t sound right so I’d reject them if I were Hiens.

    • COBwiggy

      Did you even read the article where it said in China they are the number 2 smartphone maker?

      And in my opinion, what I would picture a Lenovo BlackBerry looking like – I picture the new touch blackberry

    • Lenovo

      Heins is busy watching NBA games.

  • Paul

    I wouldn’t love to see this.

  • yuck

    rip rim time of death 2013

  • JimSillyballs

    What is it with the Chinese buying up all of Canada? Enough of this s**t. Soon Canada will be 90% Asian and 100% owned by the Chinese government lol.

    • wotzit2ya

      Cuz they have CASH …..doh .

  • Dave

    So …. Lenovo. Are you going to included an build in spy app
    on every Blackberry? Free ….. off course!

  • DareDevil

    The Canadian government would never allow this. Hell, even the US government would have a huge problem with a Chinese company owning the only secure mobile device company out there.

  • china man

    First off, alot of commenters here no speaka engrish.

    Seriously. Correct your grammar.

    Second, there are wayyyy too many tech nerds on here who no squat-all about the stock market, how to make money, and how stocks work.
    I would never win an argument with anyone as ignorant as them. So I won’t try.

    RIM has $6 per share in cash. They have 80M customers. They won’t need all the Samsung + Apple customers. They won’t need all the market share. All they need is 1/2 of the existing base to upgrade AND get a few more subscribers (5-10M). That is not a problem.
    The market had this stock priced for extinction. But that won’t happen.

    Lenovo could license BB10 and/or take over the mobile hardware business. Rim already produces the handset in China. So if this is outsourced further , for cheaper, who cares?
    Not Rim. They save money.

    Lenovo could even use BB10 in its new tablet lines, laptop/touchpads/thinkpads.

    Rim will license out BB10 and make money. This stock will never hit $12, let alone $6 ever again.

    Stocks always crash when investors panic and price in extinction. If you want proof go to 2009 and look for Starbucks, Apple, Wynn Casino, Teck Resources. Etc.

    Some of those stocks have gone up 10-30X.
    I’m not saying Rim will hit $50. But $30 maybe.

    • Woodman

      Heed your own advice and learn grammar.

  • Antny

    Spinning off the hardware division wouldn’t require huge government regulatory procedures, nor would it entail compromising any mobile data security. It’s not RIM’s hardware that encrypts the data, it’s the software. Lenovo-bashing and all this paranoia about Chinese spyware is nothing but unmitigated Sinophobia.

  • Sweet

    Given that the Canadian governments (feds & provincial) didn’t care that Chinese companies supplied telecomm equipment to some of our carriers, it’s pretty certain that they won’t care about the security risks of a Chinese company designing & making Blackberry phones. I’ll bet most of the parts in BB phones are currently made in China anyways.

    The governments will care about any loss of jobs, though.

  • me2

    which, if early indications are a bellwether, it likely will” No it won’t