RIM shares rise on takeover talk
Globe and Mail Update
Shares of Research in Motion Ltd. climbed Thursday on speculation that the Canadian maker of the BlackBerry handheld device could be bought by Microsoft Corp.
A report by Bloomberg News cited a trader in Maryland as saying there is a rumour circulating about the two companies. Greg Palmer, head of equity trading at Pacific Crest Securities Inc. in Portland, Ore., told the newswire that although there is "a rumour Microsoft is going to acquire some or part of RIM" and that might be pushing RIM stock higher, "it doesn't make sense" because Microsoft already has a handheld product.
Shares of RIM, based in Waterloo, Ont., climbed $2.10 or 2.42 per cent to $88.90 in Toronto. The U.S.-traded stock rose $2.18 (U.S.) or 2.66 per cent to $84. Microsoft stock rose 24 cents or 0.8 per cent to $28.83.
The takeover chatter also spilled into the currency market, helping send the Canadian dollar up by a third of a cent, said Steve Butler, director of foreign exchange trading at Scotia Capital.
"It's a good rumour, it sounds to me to be a bit far-fetched but hey, in this environment, it's hit a bid first and ask questions later," he said. "I certainly think it did gave Canada a bit of a lift as it made its rounds in the rumour mill."
Currency trading is so "illiquid and jittery" right now that people are quick to react to any speculation, he added.
The Canadian dollar traded at 94.65 cents from Tuesday's close of 94.30.