Certicom backs sweetened takeover bid from RIM

Encryption technology company Certicom Corp. on Thursday threw its backing behind a sweetened takeover bid from Research in Motion Ltd.

The RIM bid, which was announced on Feb. 3 for $3 a share in cash, topped a friendly bid for Mississauga, Ont.-based Certicom from VeriSign Inc. of California.

VeriSign's offer is for $2.10 a share.

RIM's earlier attempt to acquire Certicom, one of its suppliers, for $1.50 a share hit a brick wall on Jan. 19, when an Ontario court judge granted a permanent injunction blocking RIM's bid.

Certicom argued that RIM had used privileged information to draw up its hostile takeover bid. RIM, which is based in Waterloo, Ont., dropped its offer on Jan. 20. Three days later, Certicom and VeriSign reached a friendly takeover deal.

VeriSign now has until Feb. 11 to decide if it will increase its offer for Certicom.

If VeriSign decides not to raise its bid to beat RIM's latest offer, Certicom will be able to terminate its merger deal with VeriSign but will have to pay the company a $4-million termination fee.