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BlackBerry In Tentative Deal To Go Private

Waterloo, Ontario — BlackBerry will go private under a proposed deal in which a consortium led by Fairfax Financial Holdings will buy BlackBerry for about $4.7 billion.

 Fairfax, which already owns about 10 percent of BlackBerry’s common shares, signed a letter of intent to buy BlackBerry and has six weeks to perform due diligence. Fairfax would get a termination fee if BlackBerry accepts another offer in the meantime.

Fairfax expects to complete the due diligence process by Nov. 4, when both parties said they intend to execute a definitive transaction. Until then, however, BlackBerry is allowed to actively solicit and evaluate offers from other parties and enter into negotiations with those parties.

The decision was approved by the BlackBerry board based on the recommendations of the board’s special committee looking into strategic alternatives.

BlackBerry shareholders would receive U.S. $9 per share in cash. The consortium is seeking financing from BofA Merrill Lynch and BMO Capital Markets.

Fairfax chairman/CEO Prem Watsa said the transaction would “open an exciting new private chapter for BlackBerry, its customers, carriers and employees.” Fairfax, he said, “can deliver immediate value to shareholders while we continue the execution of a long-term strategy in a private company with a focus on delivering superior and secure enterprise solutions to BlackBerry customers around the world.”