BlackBerry, the Canadian smartphone maker and services company, received an 11th hour save yesterday.
In a sweeping move, the company announced that Mr. Thorsten Heins has stepped down as CEO and has given up his seat on the board. At the same time, Blackberry announced that the company was no longer for sale, and that it had entered into an agreement with Fairfax Financial Holdings Limited, one of the companies looking to take BlackBerry private, would invest $1 billion dollars into the company.
In what is sure to set Crackberry users into a tailspin was the announcement that BlackBerry will continue to build BlackBerry 10 smartphones and not sell off that part of the business.
BlackBerry also announced that Mr. Prem Watsa, Chairman and CEO of Fairfax, would become a new board member and that Mr. John Chen would be brought on as the new chairmen of the board and interim CEO.
"[...]John S. Chen will be appointed Executive Chair of BlackBerry’s Board of Directors and, in that role, will be responsible for the strategic direction, strategic relationships and organizational goals of BlackBerry. Prem Watsa, Chairman and CEO of Fairfax, will be appointed Lead Director and Chair of the Compensation, Nomination and Governance Committee and Thorsten Heins and David Kerr intend to resign from the Board at closing."
In addition, Mr. Heins will step down as Chief Executive Officer at closing and Mr. Chen will serve as Interim Chief Executive Officer pending completion of a search for a new Chief Executive Officer."
With all the churn with the BlackBerry leadership, board member Barbara Stymiest was tapped to announced the shake up.
“Today’s announcement represents a significant vote of confidence in BlackBerry and its future by this group of preeminent, long-term investors,” said Barbara Stymiest, Chair of BlackBerry’s Board. “The BlackBerry Board conducted a thorough review of strategic alternatives and pursued the course of action that it concluded is in the best interests of BlackBerry and its constituents, including its shareholders. This financing provides an immediate cash injection on terms favorable to BlackBerry, enhancing our substantial cash position. Some of the most important customers in the world rely on BlackBerry and we are implementing the changes necessary to strengthen the company and ensure we remain a strong and innovative partner for their needs.”
“I am pleased to join a company with as much potential as BlackBerry,” said Mr. Chen. “BlackBerry is an iconic brand with enormous potential – but it’s going to take time, discipline and tough decisions to reclaim our success. I look forward to leading BlackBerry in its turnaround and business model transformation for the benefit of all of its constituencies, including its customers, shareholders and employees.”Mr. Chen is no stranger to corporate turn arounds. The last time we saw him, he was CEO of Sybase, Inc, a database and corporate software company. When Sybase was purchased by SAP AG, in 2010, the company sold for $5.25 billion.
In the interest of full disclosure, I earned my Sybase ASE and Rep Server merit badges as a DBA in the early 2000's and I though that Mr. Chen, hearing him speak at two of the Sybase's annual user conferences, did a good job of turning Sybase around leading up to it's sale to SAP. I'm interested in seeing what he can accomplish with BlackBerry.
You can read the full press release on the BlackBerry website.