BlackBerry Left at the Altar by Fairfax Financial

Shares of BlackBerry  (NASDAQ: BBRY  ) got clobbered today after BlackBerry abandoned its current attempt to sell itself. Despite Fairfax Financial's (NASDAQOTH: FRFHF  ) (TSX: FFH  ) recent $9-per-share buyout offer, shares had been trading at a substantial discount. That was evidence of investor skepticism on the Fairfax deal, mostly surrounding the latter's ability to secure adequate financing. Those fears proved to be spot on, as lenders have declined to foot the bill due to the risk involved on their end.

Instead, Fairfax and other investors will be buying a total $1 billion in convertible debentures from BlackBerry, which will help beef up its balance sheet. BlackBerry is reportedly still interested in selling itself and is now more open to breaking itself up if need be.

Additionally, CEO Thorsten Heins will be stepping down less than two years after becoming CEO. The executive was dealt a poor hand to begin with, but he likely wasn't the right man for the job in the first place. It was clear that BlackBerry needed some fresh blood with external perception, which is precisely what Heins was not. 

In this segment of Tech Teardown, Erin Kennedy discusses BlackBerry's plunge with Evan Niu, CFA.

Got iPad?
Apple
's newest iPad Mini with Retina display might be hard to come by this quarter, given all the reports of supply constraints. Well, we're going to be sure to get a few -- and give them away! That's right: For the first time ever, The Motley Fool is hosting a contest where you can win a free iPad Mini with Retina display. All you have to do is tell us why you love The Motley Fool by clicking here! We'll pick the three most Foolish submissions to receive a free iPad Mini with Retina display.

See full terms and conditions by clicking here


Read/Post Comments (3) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On November 05, 2013, at 12:38 AM, sliderw wrote:

    And all the anti-Fool BlackBerry bull trolls have no comment.

  • Report this Comment On November 05, 2013, at 12:38 AM, sliderw wrote:

    And all the anti-Fool BlackBerry bull trolls have no comment.

  • Report this Comment On November 06, 2013, at 12:02 AM, HelpIsHere wrote:

    Do you guys just make this stuff up? None of your claims are correct. How is it you know what Prem Watsa is thinking when he invests billions?

Add your comment.

DocumentId: 2712152, ~/Articles/ArticleHandler.aspx, 7/30/2014 3:18:00 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement