Samsung has allegedly proposed to take over troubled smartphone maker Blackberry in a bid to boost its patent portfolio. Blackberry denies the speculations.
Citing insider sources, Reuters said the South Korean electronics giant has offered some $7.5bn to acquire Blackberry at a secret executive meeting last week.
The revelation prompted a strong reaction from Blackberry, which denied in a statement any negotiations with Samsung.
"BlackBerry has not engaged in discussions with Samsung with respect to any possible offer to purchase BlackBerry," the company said.
The price of BlackBerry’s shares reacted frantically to the developments, first rising up by nearly 30 per cent to $12.60 (£8.28) only to fall back again by 16 per cent after BlackBerry's denial.
Samsung also played down the speculations. "Media reports of the acquisition are groundless," Samsung’s spokeswoman told Reuters.
It is believed Samsung’s interest in Blackberry has been sparked by the world’s number one smartphone manufacturer’s desire to reinforce its position in the increasingly competitive smartphone market by winning over the corporate sector, the traditional stronghold of Blackberry.
BlackBerry's secure systems and email exchange networks have established the Canadian company as the the first choice of device for major companies, governments and military customers around the world. Lately, the firm has asserted its focus on secure software for mobile phones, which it hopes to be selling to rival manufacturers.
Some Canadian newspapers revealed yesterday BlackBerry has previously rejected other takeover attempts. It was reported the company’s board as well as its largest investor are confident that the restructuring delivered last year after appointment of new CEO John Chen would help navigate the company through the dangerous waters.
Any foreign takeover would also require approval from the Canadian government. Asked if it had been approached about the deal, Jessica Fletcher, a spokeswoman for industry minister James Moore, said: "We don't comment on rumours and speculation."
Canadian BlackBerry, once a key innovator in smartphone technology, lost its momentum with the rise of Apple’s iPhones and large screen Android devices such as those manufactured by Samsung. Its US market share shrank from nearly 50 per cent in 2009 to as little as 3 per cent five years later.
Blackberry launched its latest device, the BlackBerry Classic smartphone, in December, aiming at the corporate customer and featuring a traditional keyboard instead of a touchscreen.