RIM shares surge on talks of takeover bids

Frankfurt : Research In Motion Ltd. surged as much as 10.2 per cent in German trading after reports said Microsoft Corp and Nokia mulled a joint bid, while Amazon.com Inc considered buying the maker of the BlackBerry smartphone.

RIM "turned down takeover overtures" from Amazon because it wanted to fix its shortcomings independently, Reuters reported yesterday.

That was followed by a Wall Street Journal article that said Microsoft and Nokia "flirted with the idea of making a joint bid" in recent months. Both cited unidentified people familiar with the matter.

Before the reports, RIM stock had tumbled to its lowest level in almost eight years.

Last week, the company disclosed a delay in a new generation of BlackBerrys designed to fuel a rebound, adding to challenges that include lost market share and a tablet device that bombed with shoppers. The 78 per cent plunge in RIM's shares this year before yesterday leaves it vulnerable to an approach from suitors, said Sameet Kanade, an analyst at Northern Securities Inc.

Speculation

"At this valuation, it is a strong acquisition target," said Kanade, who is based in Toronto and rates RIM a "speculative buy." He doesn't own the stock.

RIM shares rose as high as the equivalent of $13.92 in German trading and were up 9.2 per cent as of 10:03am in Frankfurt.

Yesterday, RIM advanced as much as 11 per cent to $13.85 in late trading after closing at $12.52 in New York. Nokia yesterday gained as much as three per cent to €3.756 in Helsinki.

Jamie Ernst, a spokeswoman for Waterloo, Ontario-based RIM, declined to comment, as did Mary Osako, a spokeswoman for Seattle-based Amazon, and Peter Wootton, a spokesman for Redmond, Washington-based Microsoft. Nokia doesn't comment on rumour or speculation, said Doug Dawson, a spokesman for the Espoo, Finland-based company.

RIM trades at 2.83 times trailing 12-month earnings, the lowest of any communications-equipment maker with a market capitalisation greater than $1 billion, according to data compiled by Bloomberg.

The status of discussions between Microsoft and Nokia was unclear, according to the Wall Street Journal.

Amazon hired an investment bank to review a possible deal with RIM, but didn't make a formal offer, Reuters said.

Microsoft and Nokia might be able to use RIM in their rivalry with Apple Inc, the largest smartphone maker. Amazon is also vying with Apple in the tablet market.