BlackBerry owns a stake in Rockstar; BlackBerry is for sale; what might Google be thinking? 03 Nov 13
Reports over the weekend suggest that Qualcomm might be about to get involved in a consortium that could make a bid for BlackBerry. The news comes as other reports claim that Fairfax, which has so far made the only confirmed bid for the ailing Canadian company, might be struggling to raise the $4.7 billion it would need to close the deal. Qualcomm looks a very good fit for BlackBerry - it already supplies chips to the company and also has a wealth of IP knowledge and licensing expertise, something which could be very handy in leveraging the BlackBerry patent portfolio.
That said, events of the last few days have also reminded the world that BlackBerry holds a 10% plus stake in Rockstar, the NPE which on Thursday spectacularly reignited the smartphone patents wars by suing Google and a host of Android manufacturers, including Samsung, HTC and LG. If Rockstar ends up prevailing either through settlement or court victory, we may be looking at very large amounts of money changing hands; BlackBerry, of course, would be entitled to a share of that through the dividends that Rockstar pays to its owners. A sum representing 10% plus of, say, a damages award in the region of $1 billion, as well as on-going royalties, almost all of which heads straight to the bottom line, might prove very enticing to any number of bidders. And that's before all the other deals Rockstar may do in the future. It would be interesting to know whether its stake in the NPE has been factored into Blackberry valuations so far; or, indeed, whether it is part of the package.
On a related note, given that BlackBerry is still officially up for sale, how attractive might that Rockstar stake look to the companies that were sued on Thursday if it is up for grabs? I am not a lawyer so do not know the ins and outs of these things, but were it possible, if you were a Google or a Samsung, haven’t recent events made acquiring the Canadian company a whole lot more enticing? Not only would you get BlackBerry's own potentially very leveragable patent portfolio, but you would also get a share of the NPE that is suing you and possible access to a lot of new information; you may also end up getting money from yourself, if you see what I mean.
As I say, I am no lawyer and I guess there must be rules against these things – but if BlackBerry is to maximise its price I would not have thought that bids could be excluded. Thus, if one or more of the defendants in the Rockstar cases did end up buying it, BlackBerry’s stake in the NPE may have to be bought out by the other owners or a third party. That in itself may prove a satisfying outcome for those who are now staring down the barrel of a gun in the Eastern District of Texas. It’s hard to believe that this has not at least crossed a few minds.
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