Legal News

Blackberry’s Shares Took a 19% Dip in Pre-Market Trading
Download PDF
1 Star2 Stars3 Stars4 Stars5 Stars (No Ratings Yet)
Loading...

After investors became aware that Blackberry Ltd will now scrap their former plan to find a buyer, their stock price went south. At this time, Blackberry Ltd made an announcement that it will try to raise $1 billion in new funds and that it will replace its top management, including its CEO Thosten Heins and several top directors.

According to the Financial Post, Fairfax Financial holdings missed their deadline to buy out the smartphone maker in a $4.7 billion dollar deal. At this time, however, Fairfax along with other institutional investors will buy bonds in the “$1 billion dollar private placement of convertible debentures.” Fairfax will take on $250 million in debentures which are convertible into common shares at almost a 30% premium to Friday’s closing price at $10 dollars a share. If the new debentures were converted into common shares they would represent about 19% of all shares outstanding.

  
What
Where


Canaccord Genuity analyst Mike Walkley commented, “It surprised me. I actually thought they would have sold the company at any price this morning. Staying public was, I think, a worst case for the company in terms of turning it around.”

Analysts are clashing and converging in views and opinions, as the street responds to the news surrounding Blackberry Ltd. A senior market analyst from CMC Markets, Colin Cieszynski commented, “Shares could be active today off this news as traders weigh the failure of the company to attract buyers against the higher debenture conversion price.”

Interestingly, it is exactly the high yield which attracts buyers, but it is the high risk which likely caused the company to not find a buyer. Since high risk yields high return investors are likely between a rock and a hard place. Cieszynski noted, “If the shares fall too far too fast, the company could potentially start to attract hostile bids for its cash and patents.” It is safe to say that the street wants this company to go private.

Get JD Journal in Your Mail

Subscribe to our FREE daily news alerts and get the latest updates on the most happening events in the legal, business, and celebrity world. You also get your daily dose of humor and entertainment!!




While trading of Blackberry shares was stopped from 8:26 to 9:00 am this morning, the number of shares may increase by as much as 20%. The stock price dropped by 12% to $6.84 in this morning’s trading. BCG partners analyst Colin Gillis commented that today was a rough day for Blackberry’s shareholders as well as other investors and their employees and customers. Gillis also believes that the company would have flourished if it had gone private. He commented, “This is going to be painful to watch. There’s some hard decisions that are going to have to get made.”

Image Credit: Gsmarena.com





 

Interesting Legal Sites You May Like


BCG FEATURED JOB

Locations:

Keyword:



Search Now

Junior Litigation Attorney

USA-TX-Dallas

Dallas office of our client, a Chambers ranked law firm, is actively seeking associates to join our ...

Apply Now

Investment Funds Attorney

USA-NY-New York City

New York City office of our client is seeking a mid-level attorney with hedge fund, private equity, ...

Apply Now

Intellectual property litigation attorney

USA-CA-San Francisco

San Francisco AmLaw office is seeking an intellectual property litigation attorney with 2-5 years of...

Apply Now

RELEVANT JOBS

Attorney

USA-MO-Jefferson City

Successful, expanding law firm of 23 years seeks an attorney with an interest in civil litigati...

Apply now

Litigation Attorney

USA-CA-Fullerton

Southern California municipal law firm seeking attorney with 10-15 years of litigation experience.&#...

Apply now

Burned Out by Traditional Big Law? Our Innovative National Firm is Growing in Dallas!

USA-TX-Dallas

Culhane Meadows PLLC, one of the largest non-traditional law firms in the country, is continuing its...

Apply now

Burned Out by Traditional Big Law? Our Innovative National Firm is Growing in Boston!

USA-MA-Boston

Culhane Meadows PLLC, one of the largest non-traditional law firms in the country, is continuing its...

Apply now

SEARCH IN ARCHIVE

To Top