Watching BlackBerry crash in slow motion has been kind of painful, but it was assumed the saga was over when it announced it was taking its ball off the stock market and going home. Only apparently, sticking with the small child metaphor, that home has burned to the ground. Eesh, OK, maybe that’s a bit bleak, but that might be suitable considering the problems at BlackBerry.
In a press release that we’re betting smelled strongly of Scotch, BlackBerry admitted that, basically, nobody wanted to buy it. And we mean nobody:
BlackBerry said Monday morning that there is no future for the Fairfax Financial deal, valued at $4.7 billion, that was going to take the deeply troubled smartphone maker off the public markets and give it some relative peace as it seeks to turn itself around. Instead, BlackBerry will raise $1 billion through a sale of convertible notes to investors. The company will also replace Heins as CEO and will put new members on its board.
According to rumor, BlackBerry approached everybody from Microsoft to Facebook with the whole “Anybody want a cellphone manufacturer?” pitch, only to get soundly rejected. And one has to look at this strategy of selling “convertible notes” with a little skepticism. The idea is that if you give BlackBerry money now for debt, that debt will become shares of stock! In BlackBerry! How they plan to sell $1 billion of these things is anybody’s guess.
BlackBerry will probably stumble along, and ruling them out before they actually die is unfair. On the other hand, it’s a little hard to see how they’re going to get out of this particular pickle.