Samsung Looks to Buy BlackBerry in $7.5 Billion Deal (UPDATED)

Samsung Looks to Buy BlackBerry in $7.5 Billion Deal (UPDATED)

UPDATED – BlackBerry has issued a press release denying that it has discussed a possible purchase with Samsung.

“BlackBerry Limited (NASDAQ:BBRY)(TSX:BB) (“BlackBerry”) is aware of certain press reports published today with respect to a possible offer by Samsung to purchase BlackBerry. BlackBerry has not engaged in discussions with Samsung with respect to any possible offer to purchase BlackBerry. BlackBerry’s policy is not to comment on rumors or speculation, and accordingly it does not intend to comment further.”

Samsung has been involved in talks to buy fellow mobile device maker Blackberry. Reuters reports the South Korean electronics firm has made a $7.5 billion offer for BlackBerry, likely to gain control of its lucrative patent portfolio.

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Reuters:

South Korea’s Samsung proposed an initial price range of $13.35 to $15.49 per share, which represents a premium of 38 percent to 60 percent over BlackBerry’s current trading price, the source said.

Executives from the two companies, which are working with advisers, met last week to discuss a potential transaction, the source said, asking not to be identified because the conversations are private.

According to documents Reuters has access to, the offer price would imply an enterprise value of $6 billion to $7.5 billion for BlackBerry, assuming conversion of $1.25 billion of convertible debt.

Blackberry has been faced with sagging sales in recent years, as it has failed in its attempts to compete with Apple’s iOS and Google’s Android devices.

2013 saw the company receive a $4.7 billion takeover bid from Fairfax Financial, however the deal eventually fell apart. While Apple, Microsoft, and others have all shown interest, BlackBerry has been reluctant to sell the company piecemeal.

BlackBerry’s patents are estimated to be worth $1 billion to $3 billion. The portfolio contains many patents relevant to smartphone companies such as Samsung and Apple.

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