Never Miss a Beat: Get a snapshot of the issues affecting the IT industry straight to your inbox.
January 2, 2009
2 Min Read
In the latest development of Research In Motion's takeover bid of security-specialist Certicom, RIM said it will extend its expiry date of its offer from Jan. 15 to Jan. 27.
The acquisition once seemed like a natural fit because RIM already licenses Certicom's Elliptic Curve Cryptography products for its line of BlackBerry smartphones. The smartphone maker has been in acquisition talks since February 2007, but those proved fruitless. In early December, RIM made a takeover bid of about $53 million.
"As we are unable to engage Certicom management in a meaningful dialogue to advance the terms of a potential transaction, we believe it is in the best interests of our respective shareholders, employees and customers to make this attractive offer directly to Certicom shareholders," said RIM co-CEO Jim Balsillie, in a statement.
But Certicom's management felt the offer was too low, and it vowed to fight the acquisition. The company purchased ad space in local newspapers against the takeover, and it urged stockholders to vote against the bid.
"RIM's hostile bid undervalues both Certicom's valuable and unique industry-leading data encryption technology and the recent progress the company has made in implementing its strategic plan," Certicom said in a letter to stockholders in December. "RIM is attempting to acquire almost $2.00 in cash and potential tax benefits for $1.50, and would not be paying fair value for the valuable assets and operations of your company."
Certicom has also asked the Ontario Superior Court of Justice to block the bid, and a hearing is scheduled for Jan. 9. The security company also said RIM violated confidentiality agreements and it has requested the Ontario Securities Commission to cease trade order. RIM said it is "vigorously opposed" to these actions, and it will be bringing its own proceedings before the court and regulatory body.
You May Also Like