Pension funds circle as BlackBerry put up for $5 billion sale

BlackBerry is being circled by potential buyers this weekend after the mobile phone company said it would slash thousands of jobs and reported losses of almost $1bn.

The Canadian group's shares slumped by as much as 24pc on Friday following an announcement it is to cut 4,500 staff after losses of between $950m and $955m in the second quarter. Analysts declared that the business has "sailed off a cliff" and that a sale "is the only real alternative at this point". BlackBerry officially put itself up for sale last month and has hired accountants PricewaterhouseCoopers to help with its next move.

Industry experts believe the company's patents, software and cash reserves could make it worth about $5bn. Prem Watsa, whose Fairfax Financial Holdings is the mobile company's biggest shareholder, is stepping down from the BlackBerry board following reports it is looking to take the business private. Fairfax is believed to have spoken to industry and private equity players. Other potential buyers of BlackBerry could include Canadian pension funds, as well as sector rivals such as Samsung. Lenovo, the Chinese technology business, is thought to be one of the front runners.

Amazon and Microsoft have both considered buying the business in the past, although Microsoft has since sealed a deal to acquire Finnish mobile manufacturer Nokia, diminishing the odds of it attempting a second major deal. Computer giant IBM has also been mentioned as a possible suitor. BlackBerry could also spin off its popular messaging service to form a new company. BlackBerry Messenger (BBM) will soon be launched on rival platforms such as

Apple's iOS and Google Android and is widely considered BlackBerry's "golden egg". Although BBM retains a loyal core of fans, its 60m users are already dwarfed by the 200m people who use the WhatsApp service, which currently works across platforms, and has replaced text messages for many of its young users.

BlackBerry, which has reportedly sought a buyer for the entire group since last year, has struggled to keep up with rivals Apple and Samsung in the highly competitive smartphone market. In June, the chief executive, Thorstein Heins, said that the company had shipped only 2.7m of its latest Z10 phones out of a total 6.8m.

A new version, the Z30, was launched last week but was overshadowed by Apple's latest iPhones. BlackBerry sold around 5.9m smartphones in the second quarter, missing analyst expectations of 7m and down from 7.4m in the same period last year. In comparison, Apple sold 37.4m iPhones in its second quarter. BlackBerry said on Friday that its huge operating loss will include a writedown of up to $960m, partly down to unsold handsets, and a $72m charge for restructuring.

The company said it would halve its operating costs by the first quarter of 2015, and take total job losses since last year to 9,500. BlackBerry's shares closed at just $8.72 on Friday, after trading at more than $138 in 2008.