Where there was smoke there really was fire last year when rumors circulated that Lenovo was going to buy BlackBerry.
The deal never happened. Why? CBC News reports the Canadian government said “No way” to the deal.
So a few months later Lenovo bought Motorola Mobility for $2.9 billion, determined in its quest to become a smartphone player in North American and Europe.
Wow. How different Lenovo’s future could look today …
Or maybe Lenovo would have bought Motorola anyway. It’s unlikely we’ll never know, but given that Lenovo also is committed to buying IBM’s x86 business for $2.3 billion could the company have withstood the strain of three MAJOR acquisitions?
We do know this: BlackBerry was struggling – and continues to struggle.
Motorola Mobility is not going to be an easy turnaround from red to black, either, although Lenovo CEO Yang Yuanqing says not to worry. (The x86 business presents its own challenges in the cut-throat server business.)
However, on the basis of market penetration and sales it appears right now at least that Motorola Mobility could turn out to be the accelerator Lenovo needs in terms of intellectual capital, market share and distribution it needs to challenge top smartphone players Samsung and Apple.
“Ottawa Said No …”
So what happened to a Lenovo-BlackBerry deal?
CBC cites the crises mode that BlackBerry found itself in last year when its “much-anticipated” Z10 and Q10 phones failed.
Actually, “a flop” is how the CBC described it.
BlackBerry went into a spiral and began looking for a buyer as it burned through “previously cash reserves,” CBC recounted.
“It was snowballing pretty out of control,” Peter Misek, a BlackBerry analyst and managing director with research firm Jefferies, told the CBC. “Within the company, within Waterloo [Ontario – the company headquarters], there was devastation and there was glee amongst short sellers.
“It was kind of sad because thousands of people stood to lose their jobs.”
So a search began for a buyer.
Lenovo appeared ready to buy.
“It was at that time Lenovo, among others, started kicking the tires, inquiring about a potential sale,” the CBC reported. “When BlackBerry asked the federal government whether the deal would be approved, Ottawa said no and the possible sale was quickly and quietly killed.”
Those security concerns about a China-based company just won’t go away …
Could China Say “No”?
Which begs the question: Will the U.S. government OK the Lenovo-Motorola Mobility deal?
But let’s not forget the China government angle, either.
Wouldn’t be ironic if China just said no, ruling that Google Motorola Mobility-based devices presented a security risk?
After all, the Chinese are already very upset about allegations the National Security Agency spied on China’s Huawei. And Google’s strained relationship with China over censorship has been well documented.
Lenovo also must win government approval for the IBM x86 server deal.
It’s a safe assumption that Lenovo’s legal team is working some serious overtime.
[LENOVO ARCHIVE: Check out eight years of Lenovo stories as reported in WRALTechWire.]