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Lenovo bid for BlackBerry blocked by Canadian Government

Chinese multinational Lenovo's attempt to buy beleaguered smartphone manufacturer BlackBerry was blocked by the Canadian government due to national security concerns, according to reports in Canada's The Globe and Mail.

The Beijing-based computer manufacturer was actively considering making a bid for BlackBerry as the Canadian company desperately searched for a buyer ahead of the funding deadline they faced on Monday.

However, the government in Ottawa made it clear to the phone company that they would block any attempt by the Chinese firm to buy it out – citing national security concerns as a primary factor in their decision. For this reason, no proposal was ever filed.

Because BlackBerry's network is integrated with Canadian infrastructure, and its BlackBerry Messenger (BBM) service operates a secure network that handles hundreds of millions of encrypted messages each day, the risk of interference from foreign intelligence was apparently seen as too great.

BlackBerry's customers include many government agencies, businesses and Fortune 500 companies; even the President of the United States himself has long clung on to his own BlackBerry.

Lenovo, on the other hand, has been blacklisted in many Western countries. Australia, the UK, Canada, New Zealand, and the US have all rejected Lenovo machines in the higher levels of government since the mid-2000s, and it is against regulations to use a Lenovo computer on a top-secret network.

A cynic might argue that this is because agencies like the National Security Agency (NSA) are all too aware of just how easy it is to eavesdrop on BlackBerry's servers.

This isn't the first major electronics acquisition blocked because of security concerns. Last month, Ottawa rejected an Egyptian billionaire's $520 million (£323.4 million) bid to buy a division of Manitoba Telecom Services because of unspecified "national security concerns".

"I don't think anybody should be surprised that we would have concerns like that," an anonymous Canadian government official told reporters.

"We have been pretty consistent that the message is Canada is open to foreign investment and investment from China in particular but not at the cost of compromising national security."

Lenovo has more than 33,000 employees, and operates in over 60 countries.

The news comes just two days after BlackBerry CEO Thorsten Heins was forced to quit when all attempts at buyouts failed, and the Canadian phone manufacturer instead secured $1 billion (£627 million) in funding to bring itself back into profitability.

Image: Flickr (Cobb Foster)