TORONTO: BlackBerry Ltd is abandoning a plan to sell itself and will raise about $1bn from its largest shareholder and other institutional investors as it tries yet again to revive its fortunes.
The smartphone maker said yesterday that Chief Executive Officer Thorsten Heins would leave in about two weeks, as soon as the private placement of convertible debentures closes.
His interim successor will be John Chen, the former CEO of Sybase, a database software company that SAP AG acquired in 2010. Chen, who will also be BlackBerry’s new executive chairman, joined private equity group Silver Lake as senior adviser a year ago.
The private placement could eventually increase the number of BlackBerry shares by as much as 20 percent, and the company’s stock dropped 12 percent to $6.84 in morning Nasdaq trading.
BlackBerry’s largest shareholder, Fairfax Financial Holdings Ltd, has agreed to buy $250m of the seven-year subordinated debentures, which will be convertible into common shares at $10. BlackBerry did not name the other institutional investors participating in the deal. Waterloo, Ontario-based BlackBerry grew from a small technology startup into a multibillion-dollar company by pioneering on-the-go email.
But having lost much of its market share to Apple Inc’s iPhone and devices that run Google Inc’s Android software, it has been seeking a buyer for months. BlackBerry had held talks with a number of companies, including Cisco Systems Inc, Google, SAP, Lenovo Group Ltd, Samsung Electronics Co Ltd, LG Electronics Inc and Intel Corp about selling parts or all of itself.
Reuters
