BlackBerry maker up on talk of investment bank hire

Reuters News
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Posted: Oct 04, 2011 12:20 PM
BlackBerry maker up on talk of investment bank hire

TORONTO (Reuters) - Shares of Research In Motion jumped nearly 10 percent Tuesday morning on talk that it had hired an investment bank, reviving speculation that the BlackBerry maker could become a takeover target.

"There's talk that they've retained an investment bank for strategic options," a source at a New York trading desk who did not want to be identified said. The source expressed doubt about the veracity of the speculation.

"When you start hearing things being floated on a regular basis, that's unsubstantiated, I get a little more concerned that it's just somebody who's long this thing and is trying desperately to pump it up," the source said, referring to a long position in the stock, or a bet that it will rise.

RIM declined immediate comment on the speculation about an investment bank.

The stock had settled somewhat by midday but was still up more 3 percent at $21.11 on the Nasdaq in a broadly positive market. Earlier it had risen as much as 9.7 percent.

RIM's shares jumped last week on chatter that activist investor Carl Icahn had taken an interest in the Canadian smartphone maker and would use the position to agitate for change at the company.

RIM's shares have sagged more than 60 percent this year amid a series of profit warnings and a botched launch and dismal sales of its PlayBook tablet computer.

(Reporting by Alastair Sharp; Editing by Frank McGurty)