Research In Motion Limited (USA) (NASDAQ:RIMM) (TSE:RIM) shares jumped 4 percent today after a report quoted Lenovo Group Limited (PINK:LNVGY)’s Chief Financial Officer, that Lenovo Group is considering acquiring RIM, among other options, to boost its mobile business.
“We are looking at all opportunities — Research In Motion Limited (NASDAQ:RIMM) (TSE:RIM) and many others,” Lenovo Group Limited (PINK:LNVGY) Chief Financial Officer, Wong Wai Ming told Bloomberg in an interview at the World Economic Forum’s annual meeting in Davos, Switzerland. “We’ll have no hesitation if the right opportunity comes along that could benefit us.”
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The handset maker’s share surged to a 13-month high, last week, after the company’s chief executive, Thorsten Heins, revealed that it may look for strategic alliances with other companies, including a sale of its handset business.
Replying to the claims, RIM spokesman Nick Manning, said “We continue to examine all available options to create new opportunities, focusing on areas where we will be more effective partnering rather than going it alone, and ultimately maximizing value for all stakeholders.”
The Canadian company has been struggling recently after losing market share to Apple Inc. (NASDAQ:AAPL), Samsung Electronics Co., Ltd. (LON:BC94) and devices based on Google Inc (NASDAQ:GOOG)’s Android operating system. The BlackBerry maker,who was the market leader some time ago, is under pressure owing to its old line-up of devices. The company is optimistic that its new BB10 and keyboard devices will help it to regain the lost glory.
In the morning trading session, shares of Research In Motion Limited (NASDAQ:RIMM) (TSE:RIM) were up 4 percent at $18.07 on NASDAQ and 3.8 percent at C$18.10 in Toronto.
Research In Motion Limited (NASDAQ:RIMM) (TSE:RIM) is considered a national “crown jewel,” as described by the Canadian Prime Minister Stephen Harper. Any attempts to acquire the company will definitely attract some resentment. Also, a prior cabinet approval will be needed before trading RIM. All foreign takeovers with asset values of more than C$344 million ($344 million) automatically requires government approval, to determine, whether or not the deal is a “net benefit” to the country. In 2010, Canadian government rejected a hostile takeover bid for Potash Corp. by BHP Billiton Limited (NYSE:BHP)’s, on the same grounds.
A Chinese company acquiring Research In Motion Limited (NASDAQ:RIMM) (TSE:RIM) could also raise security questions. Research In Motion Limited (NASDAQ:RIMM) (TSE:RIM)’s CEO told in July that the company has faced issues in China about protecting its sensitive networks.
As far as Lenovo is concerned, company is desperately seeking an alliance to boost its position in smartphone segment. The PC maker, which launched its first touch-screen device in 2010, has already bagged the number two spot in China’s smartphone market during the second quarter of last year, from seventh place in the first quarter.