Lenovo, the Beijing-based PC and server maker, was rebuffed in its attempt to acquire smartphone maker BlackBerry by the Canadian government, which blocked its bid on national security grounds.
According to Canada's Global and Mail newspaper, Lenovo was keen to buy the Canadian company for its technology, market share and channels to market.
However, the Canadian government is sensitive over the fate of a "national champion". The government made it clear, according to the Globe and Mail, that "it would not accept a Chinese takeover because of national security concerns" due to BlackBerry's ties to Canada's telecoms infrastructure."I don't think anybody should be surprised that we would have concerns like that," an official told the newspaper.
He continued: "We have been pretty consistent that the message is Canada is open to foreign investment and investment from China in particular but not at the cost of compromising national security."
The government made its position known over the last one to two months. "Because Ottawa made it clear such a transaction would not fly, it never formally received a proposal from BlackBerry that envisioned Lenovo acquiring a stake," sources told the Globe and Mail.
On Monday, BlackBerry formally abandoned the "review" that had been attended to persuade potential bidders to come forward, after the preferred bidder, Fairfax, which is also its biggest shareholder, was unable to raise the funds. Lenovo, it seems, was the only other solid bidder for the company.
Instead, BlackBerry is seeking to raise $1bn to ensure that it has sufficient cashflow for the foreseeable future and is replacing its current CEO, Thorsten Heins, who stood to make almost $60m from a sale, with former Sybase CEO John Chen.
Chen, an IT engineer by training, will lead a turnaround of the company as "interim CEO" before handing over to a full-time replacement.
