Canada is backing the continued growth and existence of BlackBerry with a large 5-year $850 million loan to British communications giant Vodafone Group. Under the terms of the agreement, Vodafone will use $750 million to purchase equipment and services produced by BlackBerry and the other $100 million with smaller Canadian companies.
The Globe and Mail report that this is second such deal in two years between Canada and Vodafone to ensure the latter continues to purchase and promote BlackBerry’s range of services.
It marks the second time in two years that EDC has financed BlackBerry export sales to Vodafone, and the second BlackBerry-related financing with a major European telecom. At the end of 2012, EDC lent $750-million, which Vodafone recently repaid. And last year, EDC provided $256-million in loans to Telefonica SA of Spain, also to finance BlackBerry purchases.
Todd Winterhalt, Vice President of International Development at Export Development Canada – the federal government’s export lender – confirmed that the deal is being made at commercial terms but would not comment on the rate being charged.
The loan will allow BlackBerry to “solidify their presence” in Europe’s various emerging markets that Vodafone currently operates in and is seen as crucial to CEO John Chen’s aspirations of addressing BlackBerry’s fall from grace.
Winterhalt also confirmed that the EDC’s involvement was because “$750-million or $850-million is a big dollar amount and a lot of the commercial players can’t do that. They would be maxed out.”
Hey, I'm Nirave - based out of London, I'm the European Editor for FoneArena. I love travelling and can usually be found reading, playing with the latest tech or writing about travel and tech.