BlackBerry Abandons Sales Process, CEO Thorsten Heins Out
The embattled smartphone maker is raising $1 billion in new operating funds.
TORONTO -- Embattled BlackBerry has called off its sales process and announced that CEO Thorsten Heins and some board members are leaving.
The retreat, to include the Canadian-based smartphone maker raising around $1 billion in new operating funds, follows Fairfax Financial Holdings abandoning a planned $4.7 billion buyout of BlackBerry after doing its due diligence.
John S. Chen has been named executive chair of BlackBerry's board of directors and interim CEO.
While not buying out BlackBerry, Fairfax Financial and other institutional investors are to invest $1 billion in the smartphone maker via a private placement of convertible debentures.
Prem Watsa, chairman and CEO of Fairfax, has been named a lead director, while Heins and David Kerr are to exit the boardroom.
"Today's announcement represents a significant vote of confidence in BlackBerry and its future by this group of preeminent, long-term investors," said Barbara Stymiest, chair of BlackBerry's board, in a statement Monday.
Despite that optimism, BlackBerry is expected to continue downsizing as it looks to survive increased competition in the global smartphone market from Apple, Samsung and other rivals.