BlackBerry Says $1B Investment Is Complete
NEW YORK (AP) -- BlackBerry said Wednesday that a $1 billion investment by its biggest shareholder and other investors is complete.
Earlier this month the struggling smartphone company announced that it abandoned its bid to sell itself. Fairfax Financial, BlackBerry's largest shareholder with a 10 percent stake, decided not to buy the rest of BlackBerry and take it private. Instead, Fairfax and other investors said that they would inject $1 billion as part of a revised investment proposal.
The investors also have a 30-day option to buy up to an additional $250 million of additional debt.
At the time that BlackBerry dropped its bid to sell itself, the company also announced that CEO Thorsten Heins was stepping down. Chairman John Chen is serving as interim CEO.
The BlackBerry, pioneered in 1999, had been the dominant smartphone for on-the-go business people and other consumers before Apple introduced the iPhone in 2007 and showed that phones can handle much more than email and phone calls. In the years since, BlackBerry Ltd. has been hammered by competition from the iPhone as well as Android-based rivals.
This year's much-delayed launch of the BlackBerry 10 system and the fancier devices that use it was supposed to rejuvenate the brand and lure customers. It did not work. Waterloo, Ontario-based BlackBerry recently announced 4,500 layoffs, or 40 percent of its global workforce, and reported a quarterly loss of nearly $1 billion.
Although BlackBerry was once Canada's most valuable company with a market value of $83 billion in June 2008, the stock has plummeted to less than $7 from more than $140 a share.
In afternoon trading, shares slipped 4 cents to $6.44.