BlackBerry Ltd. (NASDAQ:BBRY), pushing further into security services, agreed to buy Secusmart GmbH, a provider of anti-eavesdropping technology whose clients include German officials such as Chancellor Angela Merkel.
Secusmart, a Dusseldorf, Germany-based company that already had a partnership with BlackBerry, makes voice and data encryption for mobile phones. Financial terms weren’t disclosed. The acquisition is BlackBerry’s first since the hiring last November of Chief Executive Officer John Chen, who vowed to cut losses by focusing on services to corporations and governments.
Now, having stabilized the Waterloo, Ontario-based company, Chen said in an interview yesterday that he’s laying the groundwork for hiring and sales growth. With Secusmart, BlackBerry aims to capitalize on demand for spy-proofing technology in the wake of revelations about U.S. government surveillance tactics, including allegations that Merkel’s mobile phone was tapped.
The deal is still subject to regulatory approval. Chen said he’s confident Germany will approve the sale, especially since the government already uses BlackBerry phones and software.
At a time of backlash against U.S. companies, including the German government’s decision not to renew a Verizon Communications Inc. contract, Chen said it doesn’t hurt being a Canadian company.
“Canadians are very neutral, as you know,” said Chen, who grew up in Hong Kong and is a naturalized U.S. citizen. “Canadians always do business with everybody else and it’s fine.”
Germany’s government has already distributed about 3,000 encrypted smartphones made by BlackBerry to federal officials, and has plans to order more such devices, Tobias Plate, a spokesman for the Interior Ministry, said yesterday at a news conference in Berlin.
Last month, Germany’s top prosecutor said it would start a formal investigation into whether U.S. intelligence agents tapped Merkel’s phone. The White House has said agents aren’t spying on Merkel and has pledged not to do so in the future.