The woes of BlackBerry manufacturer Research in Motion (RIM), are well known and have been reflected in its stock’s performance. Following market-analyst rumours — first reported by Reuters — that billionaire investor Carl Icahn may have bought a stake in RIM, however, its shares jumped.
At end of trading on the Nasdaq, the troubled Canadian manufacturer’s stocks were up more than four percent after having jumped as much as 6.5 percent during the day’s trading. The trend continued in after-hours trading with the stock having gained almost another percentage point at the time of writing.
The jump in the value of RIM shares may, however, prove to have been founded on empty rumours. Icahn, who Fortune Magazine once famously referred to as the “shrewdest investor on the planet,” has neither confirmed nor denied the rumours of his having bought into RIM.
Market analysts have been circumspect in their comments regarding both the rumour and the share jump.
Billy Kim, analyst for global securities and investment banking group Jefferies, after pointing out that the rumours were unconfirmed, went on to say that RIM was potentially a target for private investors, such as Icahn.
Vic Alboini, chief executive of Canadian merchant bank Jaguar Financial Corp. was quoted as saying “It would be fantastic if it is true”.
According to Canadian online news site thestar.com, Canadian investment bank RBC Capital Markets cautioned that “Carl Icahn’s stake is unconfirmed” in a market note.
It also added that, “If he has taken a position, he may likely push for a board seat, and compel the company to peruse value-creating strategies such as the sale of the company, ‘Split the Berry’ break-up and others”.
A self-made billionaire, Icahn is the 61st richest person in the world with an estimated net worth of US$13-billion, according to Forbes. He has earned a reputation for being able to spot a corporate bargain and for being an activist shareholder. Despite the global economic downturn, his hedge fund is reportedly up 20 percent this year, in part to his having a stake in Motorola Mobility, which was purchased by Google earlier this year for US$12.5-billion.
Image: Research In Motion