BUSINESS

India-born investor joins BlackBerry board

By Ajit Jain
February 01, 2012 15:41 IST

As Research in Motion goes through a major shake-up, Fairfax Financial founder Prem Watsa has taken a seat on its board, expanding it to 11 members.

The BlackBerry smart phone maker has lost 90 per cent of its stocks value in the last four years, and with its founding co-chief executive officers -- Jim Balsillie and Mike Lazaridis -- stepping down last week, Watsa has stepped in as an independent director.

While Balsillie will remain a director, Lazaridis will be the board's vice-chair and helm its new Innovation Committee.

Describing Watsa, who featured on the India Abroad Power List 2011-2012, as the 'catalyst' behind the RIM shake-up, The Toronto Star says he 'seems to have been working behind the scenes during RIM's revamp… buying RIM stock, and is now among its largest shareholders.' Fairfax is looking at purchasing more shares.

'Tackling troubled companies is Watsa's bread and butter,' The Globe and Mail says. 'His commitment to RIM reflects his long-held strategy of buying companies on the cheap and then unlocking their true value.'

Last year he carved out the deal that saved the Bank of Ireland, by leading a group of investors who pumped in funds to keep it out of the hands of the Irish government.

The India-born, Toronto-based, businessman, the G&M report adds, is not a man who is 'making this bet blindly. While many see RIM's stock price as a falling knife, Watsa sees tremendous value.'

Thorsten Heins, now president and CEO, RIM, has highlighted this value, saying, 'We have a strong balance sheet with approximately $1.5 billion in cash at the end of the last quarter and negligible debt.

We reported revenue of $5.2 billion in our last quarter, up 24 percent from the prior quarter, and a 35 percent year-to-year increase in the BlackBerry subscriber base, which is now over 75 million.'

Watsa tells the Financial Post that he believes RIM is 'one of Canada's greatest success stories' and will have a happy ending despite current challenges.

'I'm going to do everything I can as a new board member,' he adds, 'to help them.'

Image: Prem Watsa

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Ajit Jain

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