BlackBerry sale collapses as CEO quits


Blackberry has made a surprise U-turn on its planned $4.7bn (£3bn) sale to consortium Fairfax Financial, instead replacing its chief executive and raising $1bn from investors.

Watch this video from Bloomberg discussing the move here:


The announcement on Monday saw shares in the struggling Canadian smartphone maker drop as much as 19% to $6.33 in pre-market trading.

The company will now raise the money with a private placement of convertible debentures from institutional investors.

BlackBerry's largest shareholder, Fairfax Financial Holdings Ltd, will take up $250m of the debentures.

Chief executive Thorsten Heins is to be replaced by interim CEO John Chen.

In late September BlackBerry confirmed a loss of $965m (£599m) for the second quarter - much of it down to the failure of its latest handsets.

The figure included a writedown of $934m for unsold phones such as the Z10, one of two devices that were released earlier this year in a high-profile attempt to turn the company around.

But customers have not been impressed with the latest offerings and the firm continues to lose market share to rivals such as Apple and Samsung.

BlackBerry also confirmed plans in mid-September to cut 40% of its global workforce.

It said it would would lay off 4,500 employees in an attempt to slash costs by 50% and shift its focus back to competing mainly for the business customers who are most loyal to the brand.

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