Vodafone linked to RIM buy

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Widely reported rumours this week that Vodafone has been linked to buying Research In Motion (RIM), have seen the BlackBerry maker's shares climb in value.

In its struggle to maintain market share against strong competition from Apple and handset makers running Google’s Android operating system, RIM has been linked to a number of potential suitors over the last few months. Its shares have lost two-thirds of their value since February.

But the rumour - first reported on Wednesday in a Wall Street Journal blog posting - that Vodafone might be in line to acquire it, pushed its stock up 10 per cent to $24.49 (£15.96) per share.

Although both companies refused to acknowledge the rumour, saying they did not comment on speculation, principal communications and convergence analyst at Quocirca, Rob Bamforth, told IT Pro such a deal was unlikely.

“There’s nothing in the rumour from what I’ve heard,” he said. “But I think there’s certainly an element of truth in the fact that the market is wanting RIM to sort things out.”

The fact there have been other, also unconfirmed, rumours suggesting RIM is looking for a buyer supports Bamforth’s assessment: one is that investment bankers have been called in to explore its options and another has it that former Yahoo! board member, Carl Icahn has taken a stake in the company.

RIM’s shares continued to rally at the time of writing, to $25.11 (£16.36). But that is still well below their 52-week high of $70.54, reached in February.

Bloomberg also today reported that even RIM’s own executives and shareholders have not bought any openly traded shares in the last year.

Bamforth said there was no doubt that RIM had seemingly been slow to react to new trends, like full-featured touchscreens and tablets. But he conceded that any potential acquisition would need to provide a wider platform for BlackBerry than it currently owns.

“The service proposition around BlackBerry email is no longer enough,” he said. “So it is likely we’ll see device consolidation across platforms, where it’s now all about the ‘verticalisation’ of platforms, as we’ve seen with Apple, Google and the launch of Amazon’s Kindle Fire tablet.

“It’s also about being a service provider. That includes having the device as part of an end-of-end service proposition. Despite the fact RIM do other things, it’s proved hard to broaden perceptions of its brand.”

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