RIM reportedly considering splitting company in two
Struggling handset maker is considering a plan to split the BlackBerry hardware business from its messaging network, according to a Sunday Times report.
Research In Motion is considering a plan to split its company in two, separating its handset division from its messaging network and selling off the struggling BlackBerry hardware business, according to The Sunday Times.
The British newspaper (subscription required), which didn't cite sources, also mentioned Facebook and Amazon as "potential buyers." Another option has the company staying intact but selling a large stack to a larger tech company such as Microsoft.
RIM declined to comment on the report's specifics but reiterated that it's examining a wide range of strategies.
"RIM has hired advisers to help the company examine ways to leverage the BlackBerry platform through partnerships, licensing opportunities, and strategic business model alternatives," a RIM representative told CNET. "As [CEO] Thorsten [Heins] said on the company's fourth-quarter earnings call, 'We believe the best way to drive value for our stakeholders is to execute on our plan to turn the company around.' This remains true."
The company has been struggling to bring back lost market share and sales for its once popular BlackBerry devices, but it's not having much luck in an industry ruled by Apple and Android. Fourth-quarter reports show a company loss of $125 million and a 25 percent drop in revenue, and the company announced last month that it would post an operating loss for the first quarter as well.
RIM recently hired J.P. Morgan and RBC Capital to advise it on its business and financial performance. The company also referred to looking at "strategic business-model alternatives," often corporate-speak for the exploration of a potential sale.
RIM, which has announced a broad restructuring in an effort to save $1 billion by the end of the fiscal year, has quietly begun its much-anticipated layoffs as part of a cost-cutting restructuring. The company has also experienced an exodus of key executives in recent months. The company's chief legal adviser announced her resignation last month after 12 years with the company, a week after the company lost its London-based head of global sales.
Updated at 11 a.m. PT with RIM comment.