BlackBerry ends buyer search after chief exits

PUBLISHED : Tuesday, 05 November, 2013, 2:42am
UPDATED : Tuesday, 05 November, 2013, 12:17pm


BlackBerry yesterday abandoned hopes of finding a buyer, and instead pegged its future on a US$1 billion cash infusion and new management, after the sudden departure of its chief executive.

The company's announcement comes nearly three months after its largest shareholder Fairfax Financial offered to buy the rest of the business and take it private.

Fairfax instead announced it would invest US$1 billion in a private placement, and Fairfax boss Prem Watsa will be lead director of BlackBerry.

BlackBerry chief executive Thorsten Heins, meanwhile, would step down after only one year in the job, and would be replaced on an interim basis by John Chen, a statement said.

"Today's announcement represents a significant vote of confidence in BlackBerry and its future by this group of pre-eminent, long-term investors," said Barbara Stymiest, the chairman of BlackBerry's board.

BlackBerry had announced in August after a dismal year that it was looking for a suitor, among other strategic options.

Social network website Facebook, Chinese computer maker Lenovo and investment firm Cerberus backed by two BlackBerry founders and chip maker Qualcomm reportedly kicked the tyres, but no deals were reached by yesterday's deadline.

This outcome, said Stymiest, was deemed "in the best interests of BlackBerry and its constituents, including its shareholders", some of whom are suing the firm in a class action, alleging its optimistic sales forecasts for its new smartphones cost them hundreds of millions of dollars.

Chen said he looked forward to steering BlackBerry through its "turnaround and business model transformation", but asked for patience.