Feds cite national security, poised to review foreign Blackberry bids
by The Canadian Press
A foreign takeover of BlackBerry would face review under the Investment Canada Act to ensure it's a net benefit to the country and passes a national security test.
OTTAWA—Any potential foreign takeover offer for BlackBerry would face a review by Ottawa over the national security implications, said Treasury Board president Tony Clement.
“What we want is a stable environment,” he said at a Canadian Government Technology event in Ottawa.
“I think we’ll let the marketplace respond. We have a role to play obviously, which involves national security, and making sure that what occurs is in the public interest.”
A foreign takeover of BlackBerry would face a review under the Investment Canada Act to ensure it is a “net benefit” to the country and passes a national security test.
Last month, BlackBerry received a conditional takeover offer from Fairfax Financial, BlackBerry’s largest shareholder, worth $9 per share. The offer values the company at $4.7 billion and Fairfax has said the consortium of unnamed buyers would be composed entirely of Canadian investors.
However, other interested buyers are also circling the company, according to reports from various media outlets. The international tech names possibly interested run the gamut from Google, Cisco and SAP, to Microsoft and Cisco.
BlackBerry has reported dismal earnings after sales of its new line of BlackBerry 10 phones tanked. Last week, it said it expects to face costs of at least US$400 million before the end of May 2014.
The expenses are tied to the severance payments for the layoffs, as well as reworking its smartphone lineup and other changes to its manufacturing, sales and marketing operations.
This week, the Waterloo, Ont., company announced that it was laying off about 300 head office employees as part of a broader cost-cutting plan that will reduce its workforce by about 40 per cent.
BlackBerry began handing out the notices on Monday, though the cuts have been ongoing across its global operations for several weeks. The company plans to eliminate 4,500 jobs over the coming months.
Once the cuts are complete, BlackBerry will have cut more than 7,000 employees since 2011, a steep decline from a total staff that once neared 20,000.
With files from Ben Makuch in Ottawa.