RIM stock climbs on whispers of a takeover(Read article summary)
RIM stock is up this week. But is a Nokia and Microsoft takeover actually likely? RIM stock holder sure hope so.
Oh, what a year for the team at Research in Motion.
There were outages, public apologies, a full-on "apology parade," tumbling stock prices, and a problematic tablet called the BlackBerry PlayBook, which was released to lukewarm reviews, and went on to sell poorly. But on Wednesday, RIM stock rebounded, climbing 10 percent on rumors that RIM – that same ailing company – might be acquired by Microsoft and Nokia.
According to the Wall Street Journal, which quoted "people familiar with the matter," in recent months Microsoft and Nokia "flirted with the idea of making a joint bid for Research In Motion." The status of the talks is uncertain, but the flicker of interest in RIM was enough to temporarily draw the interest of investors on Wall Street.
"The leaked reports about RIM smack of desperation – either from investors long the stock doing anything they can to pump it up or bankers hoping to scrounge up some merger advisory fees," LaMonica writes. He goes on to quote Michael Pytosh, a portfolio manager with the ING Growth and Income Fund, who frames the whispers as 'a classic case' of investment bankers "smelling the chum in the water."
Certainly, things are bad for RIM, which has lost steady ground to Apple and Android, currently the most popular mobile operating system in the world. (This week, Google announced that an astonishing 700K Android devices were being activated every day.) Most recently, RIM announced it would delay the launch of 10 BlackBerry smartphones, and write-off $485 million in PlayBook inventory.