Lenovo reportedly eyeing BlackBerry to strengthen its mobile business
Just as BlackBerry is gradually recovering its mobile business with new launches, new rumours claim that Lenovo has made an offer to BlackBerry for acquisition for up to $15 per share, which might be announced in the near future. Shortly after the rumour surfaced, BlackBerry share prices increased by up to 3 percent.
News website Benzinga.com reported that Lenovo has again proposed to acquire the Canadian smartphone maker and sources with knowledge about the matter say it could be announced some time later this week. However, both companies have responded saying that they would not comment on rumours.
Lenovo has many times in the past two years tried to acquire BlackBerry which will help it strengthen its own mobile business. It is also said that senior Lenovo officials have expressed interest in discussing a takeover in the past. It was widely speculated in 2013 that the companies would merge when BlackBerry was redefining its strategies and exploring ways to strengthen its business.
A strong barrier to the such a deal would be Canadian government’s policy not to let Chinese companies acquire companies based in Canada. Any acquisition by a foreign company will require the permission of the Canadian government under the Industry Canada Act.
It is said that the government will not approve the deal for fears of national security as BlackBerry network handles a significant part of corporate communications and also communications of government executives and an acquisition by a Chinese company will put critical and sensitive national security information at stake thereby posing a threat to the security of the country.
Canadian Prime Minister Stephen Harper has told in the past that he wanted BlackBerry to grow as a Canadian company and the former Industry Minister Christian Paradis called BlackBerry a Canadian Jewel in 2011.
However, some sources say that the government might allow only the acquisition of only the mobile devices business if the companies agree that the core network infrastructure will remain with BlackBerry.