With the corporate rebranding, the new mobile operating system and new devices coming to market, all eyes are on BlackBerry. But one of the company's largest shareholders decided it was time to cash out.
Jim Balsillie, the former co-CEO and a significant shareholder in the struggling mobile device company, decided to sell all his stock at the end of 2012. Balsillie sold off 26.8 million shares in what was then Research In Motion.
The stock sale was revealed in an SEC filing this week and occurred just about a month before BlackBerry unveiled the new BB10 mobile operating system and Z10 keyboard-less handset. Depending on exactly when Balsillie sold his shares, he could have collected between $167 million and $396 million, according to a report in The Guardian.
Not a BlackBerry Indictment
The timing seems odd to those who are holding out hope that the new look and feel will revitalize the troubled company. Kevin Restivo, an analyst with IDC, tweeted that any time a single shareholder with over 5 percent of the float dumps everything, fellow investors should care. He continued, "A cynic might say Jim Balsillie's dumping of BlackBerry stock around product launch time is a big middle finger to his ex-colleagues."
Although former co-CEOs Balsillie and Mike Lazaridis recommended a succession plan that ultimately led to them handing over the reins, there could be some ill will involved as many believe it was more of a forced exit than a willing succession.
As part of the succession plan, Lazaridis stepped into the role of vice chairman of RIM's board and chairman of the board's Innovation Committee. Balsillie remained on the board for a period, but has since exited. Lazaridis remains on the board.
Michael Disabato, managing vice president of network and telecom at Gartner , told us he understands why Balsillie is cashing out now -- he has no influence on the direction BlackBerry takes. But what does this say about Balsillie's confidence in the new product operating system and hardware?
"I don't think this is an indictment against BB10. I think it's a logical approach," Disabato said. "There was a huge announcement coming out and a transient view that BlackBerry is doing something good and that the stock price would rise. My guess is he tried to ride that rise up and sell at what he thought was the peak to maximize his return."
Room for BB10?
BlackBerry's decision to postpone the release of BB10 to 2013 left the platform vulnerable in 2012 and reliant primarily on older smartphones running on BB7, according to a recent IDC report.
As a result, IDC said, BlackBerry's tight grip on enterprise users has loosened and its popularity within emerging markets has been diminished by the competition. Now that BlackBerry has unveiled BB10, the firm continued, the company is faced with migrating current BlackBerry users to upgrade while persuading smartphone users of other platforms, including previous BlackBerry users, to switch.
"With the recent introductions of two new smartphone platforms we expect some ground to be made by the new entrants over the coming years," said Ryan Reith, program manager for IDC's Mobile Device Tracker suite. "There is no question the road ahead is uphill for both Microsoft and BlackBerry, but history shows us consumers are open to change. Platform diversity is something not only the consumers have asked for, but also the operators."