BlackBerry boss ousted as deal crumbles

Oliver Smith
Follow Oliver
TROUBLED smartphone maker BlackBerry took yet another turn for the worse yesterday after its $4.7bn sale to a consortium of buyers collapsed, and the company announced its chief executive would resign.

The consortium of bidders led by Fairfax Financial will instead throw the company a $1bn lifeline investment, in return for seven-year loan certificates in the company, in a move seen as a short-term fix for BlackBerry.

BlackBerry’s share price plummeted 16.5 per cent as news broke, leaving the company at just $6.50 a share, its lowest point since 2002.

The beleaguered handset maker’s chief executive Thorsten Heins also resigned last night, having led an attempted turnaround of the company since January 2012.

Heins will be replaced by BlackBerry board member John Chen, who previously orchestrated the turnaround of enterprise software company Sybase during his time as chief executive.

“I am pleased to join a company with as much potential as BlackBerry. BlackBerry is an iconic brand with enormous potential – but it’s going to take time, discipline and tough decisions to reclaim our success,” said Chen on his appointment.

Chen stressed his experience as a turnaround artist yesterday, saying he has no interest in shutting down BlackBerry’s struggling handset business.

BlackBerry, once a Canadian technology giant, has struggled to compete with Apple’s iPhone and devices running Google’s Android software.

In August BlackBerry finally announced its plans to seek strategic alternatives, which could include its sale.

“Fairfax’s investment will buy the company some time, which it badly needs, but the company needs a new strategy more than ever,” said Ovum chief telecoms analyst Jan Dawson, stressing that communication on BlackBerry’s new strategy must start “very soon”.