(MoneyWatch) Embattled smartphone manufacturer BlackBerry (BBRY) announced that it has received $1 billion from Canadian firm Fairfax Financial and other investors, has called off its sale, and that Thorsten Heins would be replaced as CEO and resign from the board of directors.
Technology veteran John Chen, who was until this year CEO of Sybase, will become chairman of the board and interim CEO of BlackBerry. Prem Watsa, chairman and CEO of Fairfax, will become the lead director of the company. David Kerr, who had been a BlackBerry director since 2007, will also resign his position.
The company had put itself up for sale in August after years of questionable strategic decisions, poor operations, and growing financial disaster. BlackBerry once owned the smartphone market. Now, according to market analyst firms such as Gartner and IDC, it holds less than 3 percent.
There was also the plan to take the company private with a $4.7 billion deal led by Fairfax, BlackBerry's biggest investor. But there were reports that banks were wary of backing the bid, concerned that management wouldn't be able to turn the company around.
Given how far behind BlackBerry had fallen behind its competitors, the main value might have been its popular software for messaging and device management. But those systems weren't necessarily compatible with either Google Android or Apple iOS, the two market leaders.
Today was the day that Fairfax needed the financing set and that competing bids were due. It may be that no one with the money to purchase the company was willing to do so, questioning whether they would ever see a return on the investment.
The situation suggests that Fairfax is leading a group of investors who are trying to keep enough cash in the company to continue operations and buy more time to, if not affect a complete turnaround, at least show enough value to let them recoup their investments.