Boston, MA 10/07/2013 (wallstreetpr) – That the Ontario-based tech company BlackBerry Ltd (NASDAQ:BBRY) is facing a baptism of fire can no longer be hidden however much one tries it. There is one familiar story about BBRY, that it is seeking a buyer in the face of its declining fortunes. Then lately the company is likely to face a shareholder class action for what an investors terms “misleading information”.
Certainly, BBRY needs a savior that would save it from itself. Things are not better that the company’s much touted smartphone, BlackBerry 10 hasn’t been able to live up to the high hopes placed on it. Because of its dismal show in the smartphone market, the company has had to write down $930 to $960 million in its inventory.
The company though has opportunities to bolster its fortunes and effectively rival its peers in the tech industry like Apple and Google; it seemingly lacks the financial muscles to mount a strong campaign against its market peers. For this reason, BBRY is offering itself for sell, but buyers are apparently still non committal.
Names such as Google, Cisco Systems and SAP have been floated among possible buyers. And of course, one of BBRY shareholders, Fairfax Finance has also indicated interest to take the company private with a $4.7 billion purchase offer. However, this amount seems too little for the ailing BBRY to concede.
But how will things be for BBRY and its executives now that one of its investors is suing it over shareholder class action. The company and its top management are accused of illegally inflating the company’s stock price, especially by asserting, according to the complainant, that the BlackBerry 10 smartphone had been received well on the market.
The complainant claims that if the claim that BlackBerry 10 was fairing well on the market was true, there was no way BBRY could have written down over $900 million on the phone’s inventory. The investor claims investment justice for investor class of between Sept 27, 2012 and Sept 20, 2013. If this lawsuit succeeds against BBRY, it could lose several millions in investor compensation.
