BlackBerry\u0027s spinoff should bring relief to Toronto\u0027s IPO market

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There may be some relief in sight for Canada’s beleaguered iIPO market: BlackBerry Ltd.’s spinoff its Internet of Things business. Read on.

The cellphone giant turned security software provider said Oct. 4 it’s planning an initial public offering of the unit in the first half of its next fiscal year, which begins in March. The decision followedreview that had Wall Street speculating whether BlackBerry would split its segments, sell parts of the business or the whole company, whose market value stood at around US$2.5 billion before the announcement.

“We see the separation as a positive,” Raymond James analyst Steven Li said in a note Oct. 5, adding that the value of the business BlackBerry plans to spin off is “being masked by the ongoing struggles and churn in the cyber segment.” If the Waterloo, Ont.-based company achieves that valuation and decides to list in Canada, the offering would be a dramatic boost for IPO activity in Toronto. Firms have raised just $419 million through IPOs in the first eight months of this year, 78 per cent less than the tally for the same period in 2022.BlackBerry’s announcement comes as Wall Street prepares for a wave of spinoffs as household names including Kellogg Co., Intel Corp. and General Electric Co.

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