Prem and BBRY?

nwoodman · September 24, 2013

A mediocre translation.

http://tinyurl.com/n4y4etd

Cheers

nwoodman

Parsad · September 24, 2013

Who the f**k is Bernard Mooney?! ;D How many companies has he turned around. Cheers!

September 24, 2013

Yeah, see what I mean?

PatOfThePig · September 24, 2013

He is one of the most respected writer in french about investing. He is a good friend of Francois Rochon at Giverny Capital. He is one of my favorite. Sometimes he is wrong but usually he is very good. He always write what he think.

Parsad · September 24, 2013

Ok, I get your point. Cheers!

Parsad · September 24, 2013

What do they say...those that can, do...those that can't, teach! Yes, I know I'm about to get lambasted by every teacher on here, but my point was how many companies has Mooney turned around? And not just Mooney...how many companies have I turned around? So, why the hell would I put my opinion out there in a major newspaper unless I had tried to do it myself first. Armchair quarterback! Cheers!

Partner24 · September 24, 2013

Well, here is a comment from a doer about some turnaround situations ;)

In the past, I've observed that many acquisition-hungry

managers were apparently mesmerized by their childhood reading of

the story about the frog-kissing princess. Remembering her

success, they pay dearly for the right to kiss corporate toads,

expecting wondrous transfigurations. Initially, disappointing

results only deepen their desire to round up new toads.

("Fanaticism," said Santyana, "consists of redoubling your effort

when you've forgotten your aim.") Ultimately, even the most

optimistic manager must face reality. Standing knee-deep in

unresponsive toads, he then announces an enormous "restructuring"

charge. In this corporate equivalent of a Head Start program,

the CEO receives the education but the stockholders pay the

tuition.

In my early days as a manager I, too, dated a few toads.

They were cheap dates - I've never been much of a sport - but my

results matched those of acquirers who courted higher-priced

toads. I kissed and they croaked.

After several failures of this type, I finally remembered

some useful advice I once got from a golf pro (who, like all pros

who have had anything to do with my game, wishes to remain

anonymous). Said the pro: "Practice doesn't make perfect;

practice makes permanent." And thereafter I revised my strategy

and tried to buy good businesses at fair prices rather than fair

businesses at good prices.

Berkshire Hathaway 1992 Chairman's Letter

September 24, 2013

You are all being a little tough on the Fairfax team.

This is not a turnaround it is a rip and tear...something Fairfax excels at. Prem is not bluffing he is likely shopping out the pieces of Blackberry right now...I am getting interested. A few more percent drop and I will Arb this situation.

Dazel.

Cardboard · September 25, 2013

"A few more percent drop and I will Arb this situation."

Sure, and Prem will drop his bid to $6... He will then proceed to sell each piece at well above $10 but, outside the public eye since these things can only be done privately? Righhhhhht!!!.

Cardboard

obtuse_investor · September 25, 2013

That wouldn't be the fairfax way, would it?

September 25, 2013

The Fairfax guys are business people...Rim has value split up...Fairfax gave them a shot at a turn around and they screwed up....Fairfax shareholders will do fine....It is unfortunate for Blackberry shareholders that bought at higher levels and I feel for them...but they got bailed out at $9...how pissed should shareholders be at the management of Blackberry...that is where people's anger should be placed.

This is a distressed asset...and Fairfax have been buying distressed assets in all of their existence. The "Fair" fax way is to honor the $9...and that is what the will do.

Dazel.

obtuse_investor · September 25, 2013

I hope you are right Dazel. As a ffh shareholder I expect them to deal with BlackBerry as a distressed asset and extract as much value they can.

Partner24 · September 25, 2013

This is not a turnaround it is a rip and tear...something Fairfax excels at.

That's a very good question Dazel, but it's not coming from the horse's mouth. That's something I would be glad to know. What is their plan? Keep the turnaround plan? Break it and sell the pieces? Lower the costs and press the lemon until no positive cash flow from operations can be extracted? A mix between those options? Answers from FFH would help to clarify the situation.

September 25, 2013

Was not a question...rip and tear has began..4500 people let go is the beginning. You can't talk about these things in public. The masses think business is fun and exciting. They could not be more wrong most of the time.

Dazel.

alertmeipp · September 25, 2013

I heard some compare BBRY buyout to FBK's. While there is similarity, one key difference between the two is FBK actually got a superior offer from MERC.

RFP's offer is superior only to those who hold significant larger position in RFP.

BBRY - no one is buying it except Prem.

jeffmori7 · September 25, 2013

Sorry guys, I just wanted to share an observation from a respectable writer in Montreal that I respect and thought his point of view was interesting. I know it is not an analysis from me with data, but just a share opinion, and I understand Sanjeev answer about how it is easy to complain from afar and I agree.

But valueInv, I also think that some people hear do care about hearing different point of views, even if they are just opinions, as it could help them forge their idea. So what can I understand from your laconic observation? Could you at least try to explain your point as I don't get your remark. Thanks in advance.

james22 · September 25, 2013

The skeptic might even suggest that the BlackBerry offer was made to drive Fairfax Financial Holdings Ltd (TSE:FFH) (OTCMKTS:FRFHF)’s shares lower for the buyback, only for it to decide against its acquisition.

http://www.valuewalk.com/2013/09/fairfax-financial-plans-share-buyback/

September 25, 2013

This was in response to Parsad on anothe thread. Not a comment on your post.

obtuse_investor · September 25, 2013

That is pure speculative banter. FFH has had an active NCIB forever. If you look at their historical press releases, you'll see what I mean. The last NCIB was about to expire, so it was time for them to renew it anyway.

Besides, FFH's stock hardly moved on the RIM "letter of intent".

Stone19 · September 25, 2013

http://finance.yahoo.com/news/fairfaxs-watsa-says-confident-blackberry-202512390.html

Cardboard · September 25, 2013

"It is unfortunate for Blackberry shareholders that bought at higher levels and I feel for them...but they got bailed out at $9...how pissed should shareholders be at the management of Blackberry...that is where people's anger should be placed."

They should be pissed at the board too and who was on the board since January 2012? Prem Watsa. He was hailed as a hero coming in and he voluntarily offered great praise for the new CEO. If he didn't like what he saw or the direction, then he should have resigned as protest much earlier and tried to salvage the value as he is now. What happened? Was that good for Fairfax shareholders for him to stay on the Blackberry's board for so long and say nothing?

So people may say whatever they want. IMO, he does bear some responsibility for where BBRY is at the moment. It is obvious to me that a ton of effort has been put towards the new phones and it has been a major flop. He had to be a supporter until he found out too late that this would not work.

Now, I am very happy that he is now putting the reputation of Fairfax at stake in this take-over bid: never dropped the price of a bid and always moved forward. I am still confused as to why the due diligence comment was placed with such emphasis in the take-over release. It is pretty unusual.

Cardboard

alertmeipp · September 26, 2013

Nothing hurting the business more than if its own existence is questioned

.

As mentioned by others, Prem put the deal together to stop the bleeding and he is out now to do the same thing. I suspect part of it is also trying to save a Canadian story.

Alekbaylee · September 26, 2013

Wow, he really believes this thing is not dead...

Here’s what he told The Associated Press: “We thought long and hard before we offered $9 a share and we’re not in the business of offering a number and at the last minute changing the figure … Rest assured when we do this it won’t be done to split the company.”

http://www.theglobeandmail.com/report-on-business/top-business-stories/fairfaxs-prem-watsa-fires-back-at-skeptics-as-doubts-over-blackberry-deal-mount/article14540650/

petec · September 26, 2013

I am not a tech specialist at all, and I don't know BBRY at all, but there is a *tiny* voice in my head that says, "what if he's right"? I suspect Prem gets quite excited when everyone else can only see downside.

Alekbaylee · September 26, 2013

Yeah, I have no opinion either.

Only time will tell if he was right or wrong but there's a good change he knows what he's doing.

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