Blackberry enters tentative agreement to be sold

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BlackBerry Smartphone
BlackBerry announced a tentative agreement to be sold to Fairfax Financial for $4.7 billion. (AP Photo/The Canadian Press, Geoff Robins)

Canadian cell phone manufacturer BlackBerry announced a tentative agreement to be sold to a group of financial investors Sept. 23.

Under the terms of the proposed agreement, BlackBerry would be sold for $4.7 billion, or $9 per share of the company. The buying group of financial investors is led by Fairfax Financial, which is a Canadian company specializing in insurance.

After the sale is complete, BlackBerry will be a private company.

“Blackberry will still exist in the same form as it does today, but it won’t be publicly traded, so they won’t have to issue the same kind of press releases or file financial reports,” Chris Umiastowski, BlackBerry shareholder, said on BlackBerry enthusiast blog CrackBerry.com. “They’ll be able to go silent and hide any negative financial results while they work towards a long-term comeback.”

This buyout comes during trying times for BlackBerry. The company announced 4,500 layoffs and that it anticipates a net operating loss of $950 million to $995 during the company’s second quarter Sept. 20.

The companies’ goal is to have a more definitive transaction agreement by Nov. 4. During that time, BlackBerry will be allowed to negotiate a sale to other companies. If BlackBerry does enter into an agreement with another company, it will have to pay a fee.

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