BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB) shares plummeted as much as 16% to $6.27 after the company’s largest shareholder Fairfax Financial Holdings Ltd (TSE:FFH) dropped its $4.7 billion takeover bid. Instead, the struggling smartphone maker said it will raise $1 billion from institutional investors including Fairfax Financial. BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB) said it will raise funds through private placement of convertible debentures. Prem Watsa’s firm will invest $250 million in convertible debentures. Last week, there were reports that Fairfax Financial was finding it difficult to finance its tentative $9 per share offer.


John Chen new CEO of BlackBerry

In a surprising move, BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB) ousted CEO Thorsten Heins. BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB) said the former Sybase Corp. CEO John Chen will replace Thorsten Heins. Moreover, Prem Watsa said he will return to the smartphone maker’s board. He had resigned from the board during the summer to avoid a conflict of interest when BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB) announced that it is reviewing various strategic options.

Mr. Heins played a key role in the development of the BB10 operating system and Z10 and Q10 devices. BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB) was relying on those devices to change its fortunes. Though the BB10 devices were praised by critics, they failed commercially.

John Chen led Sybase from 1998 until German software giant SAP AG (NYSE:SAP) (FRA:SAP) (ETR:SAP) acquired it in 2010. He is known for rescuing Sybase from bankruptcy. Sybase had lost a large chunk of its business to Microsoft Corporation (NASDAQ:MSFT) and Oracle Corporation (NYSE:ORCL) when Chen joined the company. At the time, the loss-making company was notorious for producing unreliable software.

John Chen revived Sybase’s traditional database business and expanded the company’s focus on developing business applications. After Sybase was sold, he began working with Silver Lake Partners, a private equity firm that took Dell Inc. private with Michael Dell.

Will other investors bid for BlackBerry?

BlackBerry Ltd. (NASDAQ:BBRY) (TSE:BB) has attracted the interest of several other investors including Lenovo Group Limited (OTCMKTS:LNVGY) (HKG:0992). BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB) co-founders Mike Lazaridis and Douglas Fregin have also expressed interest in acquiring the company they once co-founded. Cerberus Capital Management has also joined the race.

Now that Fairfax Financial Holdings Ltd (TSE:FFH) has trashed its bid, the key question is how other potential suitors will react to it. It’s still unclear if any of them will go ahead and make a bid.

BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB) shares were down 12.35% to $6.81 at 10:44 AM EST.