BlackBerry to take US$400 million hit
BlackBerry Ltd expects to take $400 million in pre-tax charges related to cost-cutting, quadruple its estimate of $100 million earlier this year, the smartphone maker said in a regulatory filing late on Tuesday.
The company expects to spend $400 million in severance, “network simplification costs” and other expenses in this fiscal year and the first quarter of next year combined. In the first quarter it said it would take charges of $100 million for the current fiscal year, ending March 1, 2014.
BlackBerry, which has lost market share to Apple Inc’s iPhone and phones that run Google Inc’s Android operating system, said last month it planned to shed 4,500 jobs, more than one-third of its workforce.
The company has signed a tentative $9-a-share agreement to be acquired and taken private by a consortium led by Fairfax Financial Holdings Ltd. But its stock has languished well below the offer price, a sign investors are skeptical the deal will succeed.
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