re: BlackBerry's 11th Hour: How It Can Survive
Yes, I absolutely believe that Fairfax is in desperation mode. You have had to follow this entire saga from day one to understand what is happening.
Watsa, who is called the Canadian Warren Buffet, because his company mimics what Buffet does, abet on a smaller scale, has invested heavily in RIM over the years, the one way his company differs from BH. But he's lost big in those investments, losing billions in the process. His investment has shrunk to about $450 million, with 10% of the shares.
Now, think of what's happened. He's made this offer, but refuses to put any more of Fairfax's money into it. He announces that the rest is with outside investors (no other large stakeholder in Blackberry is involved.) but he, so far, has refused to name any of those other investors. Odd, no?
Then we have the timing. This occurred not before the devastating last quarter results were given the preliminary announcement, but after, an announcement he knew about because he sits, or sat on their board at the time. Why then? The value of the company is much less now. And the timing is suspicious. Blackberry announced that they will cancel the normal analyst call because of the offer. Hmm! Now no one can ask Heins and the others any questions about the state of the company.
And even though Watsa says that he has the deal in place, and Blackberry supposedly has accepted that deal, he's got an alternate plan in place. One that will saddle the company with $4 billion in debt. But this will allow him to suck over a billion out of the deal for his company. Not making up the long term horrendous losses he's suffered, but making a great profit on his current investment.
Whatever happens, Fairfax won't lose money in this deal vs the current value of their investment as they aren't adding to it.
Very strange, isn't it?
And now, despite supposedly accepting this deal, Blackberry is contacting several companies to ask if they are interested in buying them. This is very odd. I've never seen anything like this mess before, and I've been doing this since I was 13, and that's 50 years.