In utter surprising news, struggling Blackberry has started to look in a new direction after its $4.7 billion buyout did not work out with Fairfax Holdings Inc. The Los Angeles Times reported.
"BlackBerry is an iconic brand with enormous potential -- but it's going to take time, discipline and tough decisions to reclaim our success," John Chen, former chairman and chief executive officer of Sybase Inc. told The Times. "I look forward to leading BlackBerry in its turnaround and business model transformation."
The news comes on the heels of the company's latest efforts to find companies willing to help it hit the ground running again after falling by the wayside in selling smartphones, and keeping up with its competition including Apple, and Samsung.
"BlackBerry tried to remake itself and so far has failed," Jeff Kagan, an industry analyst said in a note to investors Friday The Times reported. "Right now there are no real answers for BlackBerry. That is a very uncomfortable place to be for investors, customers, workers and partners."
Blackberry and canadian financial services company Fairfax Holdings were recently close to a deal to privatize Blackberry, but will now fork out $1 billion for the company's revival since chief executive officer Thorsten Heins is no longer in the position The Times reported.
"Today's announcement represents a significant vote of confidence in BlackBerry and its future by this group of preeminent, long-term investors," Barbara Stymiest, chair of Blackberry's board told Yahoo Finance. "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."
Last year, Blackberry lost $646 million when its revenue significantly decreased 40 percent to $11 billion The Wall Street Journal reported. This year, the company lost four million subscribers and suffered another decrease of $84 million in the fiscal quarter that ended June 1.
Blackberry made a smaller amount of cuts over the summer from its sales, and research, and development departments. This comes just a year after the company let go 5,000 people.
As of March, Blackberry had 12,700 employees, which was the last time it revealed a total number. Two years ago, over 17,000 employees worked at the company based in Waterloo, Ontorio Canada. Blackberry also had control of 14 percent of the smartphone business. This has since dropped to less than three percent.
