In a stunning turn of events,
Shares of BlackBerry plummeted on the news, falling more than 16% in early trading in New York. Its shares were down 13% to $6.76 at 7:50 a.m. PST.
The Canadian company said the slew of announcements marked the conclusion of its review of strategic alternatives, which had seen BlackBerry shopping itself around to several potential buyers in recent weeks.
During that time, BlackBerry said it had reached a preliminary deal to sell itself to
But Fairfax has abandoned those plans and instead will lead a $1-billion investment in BlackBerry. Barbara Stymiest, chairwoman of BlackBerry's board, said the financing "provides an immediate cash injection on terms favorable to BlackBerry."
The transaction is expected to be completed within two weeks and Fairfax itself will fork over $250 million.
As part of its new plan, Heins will step down as chief executive and as a member of the board. He had been CEO for less than two years and was largely unpopular among analysts and tech watchers, who criticized him for a lack of vision and inability to end BlackBerry's downward spiral.
In the meantime, John S. Chen, former chairman and CEO of
"BlackBerry is an iconic brand with enormous potential -- but it's going to take time, discipline and tough decisions to reclaim our success," Chen said in a statement. "I look forward to leading BlackBerry in its turnaround and business model transformation."
As part of the executive shakeup, Prem Watsa, chairman and CEO of Fairfax, is rejoining BlackBerry's board and will be appointed lead director and chair of its compensation, nomination and governance committee.
It's the latest change at BlackBerry, which has been desperately trying to remake itself while watching its sales decline as subscribers opted for other smartphone brands.
Its BlackBerry 10 operating system, a major overhaul for the company that was considered its last-ditch attempt at a turnaround, has been largely a disappointment. Although tech experts have positively reviewed the OS and new devices, many have said those changes simply came too late.
"BlackBerry tried to remake itself and so far has failed," industry analyst Jeff Kagan said in a note to investors. "Right now there are no real answers for BlackBerry. That is a very uncomfortable place to be for investors, customers, workers and partners."
In September, BlackBerry announced that it had struck a tentative deal to be bought by Fairfax for $4.7 billion but continued to shop itself around.
Analysts speculated that the Fairfax-led buyout might fall apart, forcing BlackBerry to sell its assets to industry rivals.
BlackBerry co-founders Mike Lazaridis and Douglas Fregin also considered a bid for the company, but an offer didn't materialize.
That same month, BlackBerry said it planned to lay off about 4,500 employees, or about 40% of its workforce, and also reported that it lost nearly $1 billion in its most recent quarter.
Tech analysts quickly expressed doubts that BlackBerry's latest shakeup would save the troubled company.
"Fairfax's investment will buy the company some time, which it badly needs, but the company needs a new strategy more than ever," said Jan Dawson, chief telecoms analyst at Ovum. "If Fairfax had taken the company private, it could have kept that strategy to itself. But with BlackBerry remaining a public company, [executives] need to start communicating that new strategy very soon to inspire confidence in a turnaround."