Private or public, BlackBerry's problems remain the same: slumping market share, mostly uninspiring devices and cut-throat competition threatening the state-of-the-art security of the BlackBerry network.
"It potentially buys the company time, analyst James Cordwell of Atlantic Equities in London said of Monday's proposal from Fairfax Financial Holdings FFO.TO. "What it doesn't solve is, what's the long-term strategy for Blackberry."
BlackBerry virtually created a lucrative professional market for email devices, but rivals have muscled in and Apple Inc's(AAPL.O) iPhone has set a new gold standard for consumers.
On Friday BlackBerry warned of slumping sales and a big operating loss, and on Monday it said it had accepted a $4.7 billion offer from a consortium led by Fairfax Chief Executive Prem Watsa.
BlackBerry accounted for just 2.8 percent of worldwide smartphone sales in the first half of 2013, down from 5 percent in 2012, and 11 percent in 2011, according to IT research firm Gartner. The company has lost the "cool" factor that once made it indispensable in Britain and elsewhere.
BlackBerry put itself on the block in August, although the Fairfax bid is the only one on the table so far. BlackBerry has until November 4 to seek better offers, and Fairfax has until then to conduct due diligence and get financing for the plan.
"What they're trying to do is take it out of the public market, restructure it, sell off the parts, maybe have it focus on being a platform for enterprise," said John Stephenson, senior vice president at First Asset Investment Management. The company owns about 474,000 BlackBerry shares, according to Thomson Reuters data.
"Clearly they're going to have less scrutiny. Less scrutiny means they have time to work on this."
LOWER PROFILE
BlackBerry's new future, sketched out for the first time on Friday, will take the company out of the consumer market dominated by the iPhone and devices using Google Inc's(GOOG.O) Android software. BlackBerry will cut 4,500 jobs, or a third of its workforce, as it hones in on a niche professional crowd.
Without the constant glare of Wall Street's analysts, BlackBerry's new buyers could spend to win back market share or tackle longer-term projects that reshape the company. Or they could carve off attractive pieces such as BlackBerry Messenger to sell to the highest bidder.
But even that instant message service has hit roadblocks. A plan to make it available last weekend for Apple iPhone users and those with devices running Android software has been delayed at least a week.
And the market is already questioning the commitment of the as-yet unnamed members of Watsa's consortium.
"I really want to find out if there's financing lined up. I really want to find out who's in the consortium," said Peter Misek, a technology analyst at Jefferies.
Many in the financial community see Canada's deep-pocketed and influential pension funds as likely participants. The funds offered no clues on whether they will join.
The fact that the offer depends on due diligence and financing adds risk, said Bernstein analyst Pierre Ferragu.
"The due diligence process should provide multiple excuses for Fairfax to lower its final offering and may lead banks to simply pull out from what we believe would be a very risky venture," he wrote in a note to clients.
He suggested that holders of BlackBerry shares sell as soon as possible, while those with short positions should cover their bets as the stock will likely remain under pressure.
MADE-IN-CANADA
Fairfax clearly believes it has structured its deal to avoid the Canadian government reviews that have plagued recent prominent attempts to buy up domestic companies, stressing the Canadian nature of the transaction. <ID:L2N0HK16R>
"Our proposal offers a high level of certainty of regulatory approval," Watsa said in a letter to BlackBerry that dismissed antitrust concerns.
He also expressed confidence that Bank of America Merrill Lynch and BMO Capital Markets could finance the offer.
The Fairfax consortium suffers no penalty if it walks from the deal, while BlackBerry pays a break fee if it chooses another offer.
Regardless of whether the deal goes ahead, BlackBerry faces a wall of challenges, including declining phone shipments, a diminishing cash pile and a string of quarterly losses.
It has lost its stranglehold on secure email communications, as law firms, companies and governments increasingly allow workers to use other devices.
"We have used Blackberry in the past; however ... in late 2011/early 2012 we took the opportunity to test iPhones and found our users liked them better," said Peter Alexander, chief information officer at the Australian Treasury, noting that the iPhone is available at a lower cost.
"So we have replaced Blackberry with iPhone - the reason is they meet our security requirements and are more user friendly - with a wider selection of applications."
Even the U.S. Pentagon, with its extreme focus on security, has started allowing use of different smartphones. But the Canadian government said on Tuesday it will not abandon the BlackBerry.
"When it is determined that an employee's job function requires a cellular device with e-mail capability, a BlackBerry device is normally assigned," a spokesman said.
BlackBerry had pinned its hopes on a new line of BlackBerry 10 devices, the touchscreen Z10 and Z30, and the Q10, with the mini-keyboard that many users like.
But the new devices need new servers, and some professional customers have been reluctant to switch.
That said, there are a few hopeful signs.
BlackBerry said on Tuesday that 34 of Britain's FTSE 100 major companies are testing or using its new servers which allow BlackBerry to manage its own brand of devices as well as Apple and Android gadgets in the workplace.
(Additional reporting by Cameron French and John Tilak in Toronto, Rob Taylor in Canberra, So Young Kim in New York, David Alexander in Washington and Louise Egan in Ottawa;
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