Why Microsoft is BlackBerry Ltd (NASDAQ:BBRY)’s Likely Merger Partner And Not Xiaomi

Boston, MA – (NYSEPOST) – 05/21/2015 – BlackBerry Ltd (NASDAQ:BBRY)’s current valuation and sentiments in the Street is built around its security solution business that has continued to outperform as the hardware business continues to struggle.  The company’s business model has over the years shifted towards the software side as questions continue to be asked why the company continues to produce smartphones amidst low returns.

Weakness on the hardware side of the business has seen the Canadian company touted as an acquisition target for the likes of Microsoft Corporation (NASDAQ:MSFT) and Xiaomi.

 Potential BlackBerry Suitors

Microsoft acquiring BlackBerry Ltd (NASDAQ:BBRY) would make a lot of sense as it is also struggling on the hardware side of the business. There has been talk that Microsoft Corporation (NASDAQ:MSFT) may push on a deal valuing BlackBerry at $7 billion as it looks to leverage the company’s security solutions that are extremely valuable. Any company looking to acquire BlackBerry will not be doing it because of its smartphone business, but because of its rich patents especially in areas of security.

 Xiaomi is also believed to be a potential buyer of BlackBerry Ltd (NASDAQ:BBRY) as one of the ways of enriching its patent portfolio. Such a deal occurring looks unlikely as the company continues to provide security solutions to key government installations around the globe. The U.S and China have not had the best of relationships and regulators are likely to block any deal of the sort out of fear of the Chinese government scrutiny.

BlackBerry’s QNX Platform

Xiaomi has been touted as a possible acquirer because it is the only hardware giant with a limited number of patents compared to other companies; a weakness that continues to limit its ability to expand out of China.

BlackBerry has made huge strides on the security aspect of devices and with the adoption of smartphone constantly on the rise Samsung and Microsoft may look to use this opportunity to sharpen their edge in the business.

BlackBerry Ltd (NASDAQ:BBRY)’s QNX car platform is another opportunity that the likes of Microsoft and Samsung would wish to get hold of, to gain direct access to the internet of vehicles. A space that is on the rise thanks to the ongoing development of semiautonomous car features.