Blackberry's end times are apparently delayed: a sale is off the table, and the new plan is to raise $1 billion in new funds and find a new CEO.
Until today, Fairfax Financial was all set to buy the embattled Canadian mobile giant for bargain bin prices. Blackberry filed a "letter of intent" to sell itself to Fairfax in September for the low, low price of $9 per share. The sale was announced the week after Blackberry laid off 40 percent of its employees and announced billion dollar losses. Fairfax had until today to finish reviewing Blackberry's books — and now the sale is off. It's not clear which side pulled the chute on the sale.
Blackberry CEO Thorsten Heins will be replaced by John Chen. And the fundraising hunt is on. The Globe and Mail has the gory details:
The new plan will involve raising roughly $1 billion by selling convertible notes to a group of investors, according to people familiar with the transaction. Chief executive officer Thorsten Heins will depart the company, and the company will announce changes to its board, the people said.
While the outright sale is off, Fairfax isn't out of the Blackberry game just yet. CTV News reports Fairfax will lead the group of investors putting new money into the company.
Some are skeptical the new moves will be able to save the company. Abandoning plans to sell seems like a move that only delays the inevitable. At one point, rumors had Cisco Systems, Google and SAP separately interested in purchasing all or part of the company. But now a sale is off, which seems like another embarrassing mark for Blackberry's very bad year. "Surprising it still has somewhere to plunge from," remarked Business Insider's Henry Blodget on Twitter. "Who on earth would lend Blackberry $1 billion in converts?" asked Reuters' Felix Salmon.
There's an old saying, something about a sucker born every minute. Seems apt here.