Earlier today, BlackBerry announced some major changes to their leadership structure. Thorsten Heins, President and CEO of the Waterloo-based company, will step down and be removed from the Board of Directors. Current board member David Kerr will also resign from his position.
Arriving to save the struggling company business is John S. Chen, BlackBerry’s interim CEO and soon-to-be Executive Chair of the Board. Prem Watsa, head of Fairfax Financial, the company that holds 9.9% of BlackBerry stock, and is investing another $1 billion into the business, will come back to BlackBerry as “Lead Director and Chair of the Compensation, Nomination and Governance Committee.”
As stated back in August, Heins is set to cash in on this misfortune. According to a May proxy filing, if Heins was terminated he would receive a compensation package valued above $22 million.
In the press release, Chen stated, “BlackBerry is an iconic brand with enormous potential – but it’s going to take time, discipline and tough decisions to reclaim our success. I look forward to leading BlackBerry in its turnaround and business model transformation for the benefit of all of its constituencies, including its customers, shareholders and employees.”
BlackBerry previously declared that they’ll shift their attention away from the consumer market and focus on becoming “the leading brand today for enterprise security, manageability and reliability.” In an interview with Reuters today, Chen also confirmed that he has no plans to shut down its handset business. BlackBerry sold 3.7 million smartphones in its second quarter, down significantly from its legacy BlackBerry heights. The company promised to release a few new BlackBerry 10 devices, including 2 high-end devices and 2 entry-level devices, both all-touch and QWERTY models. The most recent consumer smartphone in the lineup is the Z30, which we found to be the best BlackBerry ever, for what it’s worth.
BlackBerry has about $2.6 billion in cash, and the $1 billion bond infusion from Fairfax gives them roughly $3.5 billion to play with. BlackBerry expects the next few quarters to significantly draw from that cash repository as they pay out the roughly 4,500 employees and reassess their product lineup. We’ll see the company continue to focus on the rollout of BBM to the web, and bring in revenue from its BBM Channels initiative.
