Fairfax's $4.7 billion acquisition of BlackBerry is off the table, CEO Thorsten Heins steps down

By on November 4, 2013, 12:15 PM
blackberry, ceo, thorsten heins, fairfax, ceo thorsten heins, john chen

Fairfax Financial Holdings’ $4.7 billion deal to purchase struggling handset maker BlackBerry is off the table today. What’s more, BlackBerry chief Thorsten Heins has stepped down and is being replaced by interim CEO John Chen.

Instead of purchasing the company outright, Fairfax will instead lead a group of investors willing to put forth $1 billion to try and right the ship. Specifically, the investment will come through a debt sale although Fairfax will inject $250 million personally into the company.

In a statement on the matter, current BlackBerry chair Barbara Stymiest said the board conducted a thorough review of strategic options and pursued the course of action that they believe is in the best interest of BlackBerry and its constituents and shareholders. She further noted that today’s announcement represents a significant vote of confidence in the company and its future by the group of preeminent, long-term investors. 

Interim CEO John Chen most recently helped turn around Sybase, a company that found itself in a situation not unlike BlackBerry’s at one point. He has extensive experience in the mobile sector which is expected to be an asset to the company until a permanent replacement can be found. Stymiest noted as much in the aforementioned statement.

He will also now serve as executive chair of BlackBerry’s board. Combined, that’s an awful lot of responsibility and power to take on at once.

Share value in BlackBerry has plunged nearly 16 percent on the news. As of writing, it sits at $6.55 per share.




User Comments: 4

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Ranger1st Ranger1st said:

As I understand it Thorsten walks away with a $54-ish million dollar bonus upon leaving.. yeah, he's really upset, I bet we can see him crying all the way to the bank.

MrAnderson said:

Google should snap them up for the patents (to get a stake in the Nortel portfolio) and roll all other stuff into Motorola, having them coordinate.

The question is, would they be blocked as a Monopoly in the market? Perhaps not since Apple still holds a large profitable stake, and Microsoft is seeing growth.

What do you think?

1 person liked this | lawfer, TechSpot Paladin, said:

As I understand it Thorsten walks away with a $54-ish million dollar bonus upon leaving.. yeah, he's really upset, I bet we can see him crying all the way to the bank.

In his defense, it is a lot to carry out the bank.

RzmmDX said:

Google should snap them up for the patents (to get a stake in the Nortel portfolio) and roll all other stuff into Motorola, having them coordinate.

The question is, would they be blocked as a Monopoly in the market? Perhaps not since Apple still holds a large profitable stake, and Microsoft is seeing growth.

What do you think?

I don't know whether the Nortel you're referring to is the one that I found which was already bankrupt... while RIM is already a sinking itself... added that the Motorola purchase was already viewed as a huge mistake.

Sure, Google could easily throw in the money but it just doesn't make sense, patents or not.

If a company really has these super awesome patents... shouldn't they be licensing it out as their primary business model instead of making stuff with it and going out of business...

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