Could Apple Inc. (NASDAQ:AAPL) be in talks to bring Blackberry Ltd (NASDAQ:BBRY) under its umbrella? According to rumors circulating on Monday morning on Wall Street it’s possible. The companies have not been true rivals in many years, and Apple could desire Blackberry as part of an enterprise push, but the acquisition seems unlikely.
At time of writing shares in blackberry Ltd (NASDAQ: BBRY) were trading up by more than 2% apparently on the strength of the rumors. Just weeks ago rumors that Twitter Inc (NYSE: TWTR) had hired investment bankers from Goldman Sachs to stop a buyout from Google lead to absolutely nothing in real terms. It’s not clear if today’s rumors are of the same sort, but there’s no substance behind them right now.
The apparent cause of the rumors leads back to a spike in volume on Blackberry stock. Volume in trading of the stock is at over 10 million shares at time of writing, well above the average daily volume of 8.63 million shares. Those numbers don’t directly point to a takeover, however, and the origin of Apple’s part in the story remains unknown.
Twitter reacts to Blackberry Apple deal
Users on Twitter shared their bemusement, and excitement, at the idea of Apple acquiring Twitter on the social network this afternoon.
Oh, so $AAPL is now buying $BBRY? I thought it was going to be Samsung, Lenovo, Microsoft or Google?
— Gary (@gverlz) May 11, 2015
Watch $BBRY over 10.19…. this rumor makes sense to me…Bullish options flow. $AAPL
— Antonio Costa (@ACInvestorBlog) May 11, 2015
Mixed fruit bowl? $BBRY up 2%. Big volume. Both @briefingcom and @benzinga are citing chatter that $AAPL may buy. Believe it when I see it.
— Paul R. La Monica (@LaMonicaBuzz) May 11, 2015
Apple Blackberry rumor unlikely
It’s not that there’s no reason for Apple to buy into Blackberry, it’s that it would be an uncharacteristic move for Tim Cook and his management team. Blackberry would be the company’s biggest buy of all time, and Apple tends to be conservative with its cash, whatever Trip Chowdhry from global Equities says about Luca Maestri.
Blackberry was, at one point, directly up for sale but the company was unable to find a suitor to take it in at the right price. Since August 2013, when the company made that fateful decision, CEO John Chen had lead Blackberry through a turnaround of sorts, though many investors may wish for something more in terms of value growth.
Shares in the Waterloo, Ontario handset maker have lost close to 7% of their value since the beginning of the year.
Back in January an apparently strong rumor that Blackberry was just about to be acquired by Samsung was reported across the market. Reuters reported that the $7.5 billion deal was based on a desire to own the patents of Blackberry. Samsung, according to that rumor, is still very much stuck in a patent war mentality.
Apple Blackberry buyout rumors
Rumors like that of Apple and Blackberry joining forces are more or less just entertainment until proven otherwise. There’s been quite a lot of tech market buyout speculation in recent months with the actual results falling short of anything.
Apple is about the last company likely to make a big acquisition, and its involvement in Blackberry today rather than two years ago appears to make little sense. Back in 2013 and 2014 the reasons often given for a partnership between the companies included shoring up patents and breaking into enterprise.
Apart from an Ericson case, the patent wars are mostly over for Apple and the company has an incredible stranglehold on the enterprise market. There seems no reason for Apple to want Blackberry now if the company didn’t want Blackberry when it was for sale, unless the Passport design has captured the imagination of Jony Ive.