BlackBerry, despite declining sales, continues to ooze confidence with its ongoing buying spree. This time, the Canadian security giant has incorporated mobile security company Good Technology in a staggering $425 million cash transaction — a company with which it had often been at loggerheads.
The acquisition emphasizes BlackBerry’s move into enterprise mobile security from consumer products — an area where it has ben struggling to stay afloat since the past few years. GoodTechnology is also a company that belongs to the same niche so the acquisition is not all that of a shock, however what does make it surprising is the fact that both the companies had often found themselves at the opposite ends of the ring — it bouts that were all too public!
In fact, GoodTechnology took a swipe at Blackberry only last year, when it published a paper comparing both the companies products in which it belittled the latter’s BES 7, ending with the following note,
The vast majority of our customer requests for information are on migration from BES 6 or 7 to Good based on their installed base, hence the origin of the paper.
Blackberry responded by publishing a blog post, in which it refuted, what it called were “sensationalized reports surrounding our viability and misperceptions about our product portfolio.” following up with punches of its own.
So its pretty obvious why the acquisition did cause more than a few raised eyebrows. However, it seems like BlackBerry is ready to let bygones be bygones and focus on the future, indeed Chief Operating Officer Marty Beard, answering questions in a Q&A seesion, said
Some people may not realize it, but BlackBerry and Good [Technology] have both been delivering secure mobility for more than a decade, Our industry is very competitive and is constantly evolving, so it’s not surprising that we’ve each taken some aggressive positions over the years. But when you look more closely, you see that we share a common heritage in security and our strengths complement each other incredibly well.
Speaking on the topic, John Chen, BlackBerry Executive Chairman and CEO said,
By acquiring Good, BlackBerry will better solve one of the biggest struggles for CIOs today, especially those in regulated industries: securely managing devices across any platform. By providing even stronger cross-platform capabilities our customers will not have to compromise on their choice of operating systems, deployment models or any level of privacy and security,
Further adding that,
With this transaction, BlackBerry will enhance its sales and distribution capabilities and further grow its enterprise software revenue stream.
Considering the fact that Good Technology claims to have more than 6,000 clients across banks, aerospace, healthcare, and other sectors, the deal will allow BlackBerry to almost double on the mobile security front.
Another factor in favor of the deal was the fact that, out of GoodTechnology’s consumer base, almost 64 percent of activations come from iOS — which a big plus considering Apple’s growing market share. The company’s shares also rose nearly 4 percent following the news of the acquisition after falling down almost 32% in this year.
BlackBerry certainly has high hopes from the deal which according to expectations, will be finalized in the third quarter of fiscal year 2016. The company is hoping to boost earnings and realize almost $160 million in GAAP revenue from Good in the first year after the closure.