RIM Stock Jumps on Samsung Takeover Rumors

| Rumor

RIM Samsung Takeover Rumor

Reviving rumors from earlier this year, Research in Motion [RIMM] is up over 10 percent in early trading on rumors that mobile giant Samsung is interested in acquiring the beleaguered device maker.

Today’s rumors follow a Barron’s report Tuesday that the future of RIM remained bleak and that a partnership or acquisition was necessary to save the former smartphone king.

“Given recent management comments in the press, it now appears that RIM is realizing what Wall Street has been saying for some time: they are a subscale manufacturer and desperately need a partner,” the article quotes Jefferies & Co.’s analyst Peter Misek as saying.

“We believe RIM is attempting to revive discussions with Samsung regarding a BB10 licensing deal,” Mr. Misek added.

RIM CEO Thorsten Heins appears to agree with Mr. Misek’s conclusion, telling The Telegraph last week: “We don’t have the economy of scale to compete against the guys who crank out 60 handsets a year. We have to differentiate and have a focused platform. To deliver BB10 we may need to look at licensing it to someone who can do this at a way better cost proposition than I can do it. There’s different options we could do that we’re currently investigating.”

“You could think about us building a reference system, and then basically licensing that reference design, have others build the hardware around it — either it’s a BlackBerry or it’s something else being built on the BlackBerry platform,” Mr. Heins added.

RIM, once the dominant provider of pre-iPhone era smartphones, has struggled significantly during the past five years as products from Apple and Android-based devices have lured away customers and profits. After replacing its longtime leadership earlier this year, the Canadian company pegged its hopes on the eventual release of its BlackBerry 10 operating system, set for launch sometime in 2013.

UPDATE: It looks like many RIM investors took advantage of this morning’s price jump to get out of the company. RIMM trading is now down almost five percent from its daily high.

 

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Comments

MOSiX Man

Samsung makes good money and they’re seriously focused on Android phones. They can’t really get anything out of RIM, other than patents. Blackberry is rapidly bleeding marketshare, BlackBerry 10 seems unlikely to make much of a difference in that situation, and RIM is hemorrhaging money. Why would Samsung be interested in buying them before they’re even cheaper to buy?

Lee Dronick
MOSiX Man

Lee,

That is funny, but the sad truth is that before the iPhone was announced, Samsung was gratuitously mimicking the BlackBerry.

wab95

See Today?s Joy of Tech comic


Very funny, but unfortunately for Samsung, the prevailing sentiment. Heard it loud and clear earlier this week on two of Bloomberg’s shows.

Just like Google, Samsung are now in search of a legal definition of ‘we did not copy’. The entire legal system seems too confrontation-averse to come out and say what is already public consensus.

Johny Mentor

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