If a new report from the Wall Street Journal proves correct, no employee of BlackBerry is safe.
According to the WSJ, the Waterloo-based smartphone pioneer could lay off up to 40% of its staff—or roughly 5,000 employees—by the end of this year. The cuts would impact all departments. The company is currently neither confirming nor denying the volume of potential layoffs.
BlackBerry is also in the process of lobbying the Canadian government to allow for a foreign buyer to acquire parts or all of the company. Currently, the Investment Canada Act states that the government automatically reviews any foreign takeover bid of more than $332 million. BlackBerry’s marketshare is currently around $5 billion.
BlackBerry, which has struggled in recent years amid competition from Apple, Google, and others, is unlikely to be sold in a domestic buyout. The only serious bidder at the moment is Prem Watsa and his firm Fairfax Financial Holdings; as the largest shareholder in BlackBerry, he’s been trying to pull together pension funds to acquire the Waterloo company. But insiders suggest his plan is crumbling due to a lack of interest.
It’s unknown whether there are any serious foreign bidders circling BlackBerry, but it would at least open up the company’s options. Right now, a foreign takeover would most likely be rejected by the Canadian government, which could be why interest has so far been minimal.
Shares in BlackBerry sunk 2% in trading today.