BlackBerry Acquired Social-Media Startup in May

BlackBerry Ltd. (BB) said it made an acquisition earlier this year, placing a bet on the future of its instant-messaging service just months before it made preparations to sell itself.

The struggling Canadian smartphone maker said today that it acquired software developer Scroon in May, its first publicly disclosed acquisition in more than a year, according to data compiled by Bloomberg. The French startup manages Facebook, Twitter and other social-media accounts for large clients like luxury-good maker LVMH Moet Hennessy Louis Vuitton SA, wireless operator Orange SA (ORA) and Warner Bros. Entertainment. Financial terms weren’t disclosed.

Scroon is part of a strategy to profit from the BlackBerry Messenger instant-messaging service, said Alexandre Mars, the startup’s founder, in an e-mail. Waterloo, Ontario-based BlackBerry made the BBM software available for free last month to iPhone and Android smartphones users, who have since downloaded it at least 20 million times. It’s one of the few areas of growth for BlackBerry, which took a writedown in September of almost $1 billion for unsold phones.

BBM, which comes already installed on BlackBerry phones, now has more than 80 million users, including 20 million on Google Inc.’s Android platform and Apple Inc.’s iOS, BlackBerry said last month.

Photographer: Simon Dawson/Bloomberg

The newly launched BlackBerry Z30 smartphone, produced by BlackBerry Ltd., is displayed for a photograph in London. Close

The newly launched BlackBerry Z30 smartphone, produced by BlackBerry Ltd., is displayed... Read More

Close
Open
Photographer: Simon Dawson/Bloomberg

The newly launched BlackBerry Z30 smartphone, produced by BlackBerry Ltd., is displayed for a photograph in London.

New BBM channels -- essentially chat rooms focused on specific themes -- will eventually create opportunities for advertisers to target users by sponsoring posts, Andrew Bocking, the BlackBerry executive in charge of BBM, said in an interview in May. It’s too early to say when BBM channels might begin to generate revenue, he said at the time.

‘Delicate Buzz’

Scroon’s Mars said he hadn’t disclosed the purchase by BlackBerry before because of the “delicate media buzz” around the company, which introduced a new line of phones this year in an attempt to regain market share. After the devices flopped with consumers, BlackBerry announced in August it would consider takeover offers and focus more on phones for business users. This month, it shelved plans to sell itself to a group led by Fairfax Financial Holdings Ltd. (FFH), its largest shareholder.

BlackBerry dropped 0.7 percent to $6.04 at the close in New York, bringing its decline this year to 49 percent.

The last time BlackBerry disclosed that it had bought a company was in March 2012, when it acquired Paratek Microwave Inc., according to merger-and-acquisition data compiled by Bloomberg.

To contact the reporter on this story: Hugo Miller in Toronto at hugomiller@bloomberg.net

To contact the editor responsible for this story: Nick Turner at nturner7@bloomberg.net

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.