Lenovo and RIM play down acquisition talks

News 25 Jan, 2013

Possible partnership isn't out to of the question as both firms looks to gain smartphone market share.

Lenovo and RIM have played down talks of a potential M&A deal despite the chief financial officer of the Chinese PC maker claiming a merger could be on the cards.

Wong Wai Ming, CFO of Lenovo specifically name-checked the Canadian firm when he was asked about how it might strengthen its position in the mobile market.

“We are looking at all opportunities - RIM and many others,” Wai Ming told Bloomberg at the World Economic Forum in Switzerland.

“We’ll have no hesitation if the right opportunity comes along that could benefit us and shareholders.”

In statements to IT Pro, both firms have since downplayed the comments.

“We are aware that Lenovo's CFO Wai Ming was speaking broadly about M&A strategy in a recent interview,” Lenovo noted.

“RIM was raised as a potential target by the journalist and Mr Wong repeatedly answered in a manner consistent with all of our previous statements on M&A strategy.

"Lenovo is very focused on growing its business, both organically and through M&A. When inorganic ideas arise, we explore them to see if there is a strategic fit," the statement added.

Similarly, RIM emphasised that it is solely focused on the launch of its BB10 range, which is set for 30 January.

“We do not have anything new to report on our strategic review at this time. [CEO] Thorsten Heins has made it very clear that we are focused on the delivery of BlackBerry 10,” RIM said.

“As he said on our most recent results conference call on 20th December, we continue to examine all available options to create new opportunities, focusing on areas where we will be more effective partnering rather than going it alone, and ultimately maximising value for all stakeholders.”

At present Lenovo has been focusing on the smartphone market in its home territory of China – where it has launched devices such as the K800.

The firm was one of the first to sign a deal with Intel to use x86-based Atom chips in its smartphones. However, Lenovo has yet to take the plunge into the western Europe and US markets where Apple and Samsung dominate.

Meanwhile, RIM has been losing its grip on the smartphone market as it delayed the launch of its BB10 to make sure it wasn’t rushed out.

Although acquiring RIM's hardware business could be beneficial for Lenovo, the chances remain slim at this point, as there would a host of regulatory hurdles to overcome.

Under its rules for foreign investment, the Canadian government would have to greenlight the deal as it would be worth more than $344 million.

A more likely scenario would see Lenovo making a deal with RIM to license out the BB10 OS, especially given comments from Heins earlier this week.

The RIM CEO claimed that it was conceivable that the BB10 operating system could be licensed out in the same way that Microsoft had done with the Windows Phone software.

“Before you licensed the software, you must show that the platform has great potential. We must fulfill our promises first. But if such proof is provided, licensing is conceivable,” Heins said.