RIM (RIMM) is on most analysts' lists of takeover targets. Its recent problems, including slow subscription sales, the lackluster reception of its Playbook tablet, and late product launches, have pushed the stock to a seven-year low. It's troubles are so severe that some analysts think RIM is no longer a valuable acquisition. That's not true. RIM's remaining strengths are great, and in some ways, unique.
First, the company has 75 million subscribers, a large portion of them are overseas in places that Apple (AAPL) has been slow to build its iPhone distribution, particularly in China.
Next, RIM has an operating system that has not been drawn into the large number of patent lawsuits that Apple, Samsung, and the Google (GOOG) Android based smartphones are embroiled in. By avoiding IP disputes, RIM can watch from the sidelines court battles that could cost the losers billion of dollars.
RIM's share price is $14.25 (as of the morning of Dec. 29), compared to a 52-week high of $70. It trades at an extraordinarily low of 0.37 times total sales. That makes it a fine target for several companies that will want to hedge their bets in the smartphone market -- among them Microsoft (MSFT), HTC, and Samsung -- the No. 2 handset company in the world. The media has recently reported that Microsoft and Nokia (NOK) have considered a joint bid for RIM. Apparently, Amazon (AMZN) has as well. Any consideration these companies make a definite offer is likely only in early stages, if an official offer is to be made at all. These rumors have pushed RIM share up 10%.