Fairfax buys off another $250million of Blackberry’s debt following renewed interest in 2014

by Andrew Roach on January 13, 2014

It’s fair to say that 2013 was a disaster for Blackberry as they struggled in almost every department whether it was their new Blackberry 10 smartphones failing to light up the market or the company recording record losses month after

However, the struggling smartphone manufacturer has made a positive start to 2014 and their hopes have been boosted by the news that their largest shareholder Fairfax Financial Holdings has injected another $250m into the company.

The recent boost will see Fairfax buy around $250m worth of debt from the company and comes just a couple of months after they had injected a similar amount into the company to help manage running costs.

Fairfax has always shared an interest in Blackberry and had been linked with a takeover bid for the company before a lack of interest from other investors forced the proposed deal to fall though.

The move will come as a welcome relief to the Waterloo based company and is a tell-tale sign that the company is starting to turn their struggling form.

As an extra part of a promised $1bn deal to help boost running costs, the next $250million will help eradicate some of the large debts that the company has invested over the past couple of years.

Fairfax owner Prem Watsa has had a big hand in helping Blackberry out during their troublesome patch having not only helped bring in extra sources of financial support but also had a hand in finding a successor to Thorsten Heins during the executive shuffle late last year.

Since John Chen came into the CEO position, the company has looked to revert back to the factors that helped the company become global powerhouses at the start of the century with much of their focus going to their corporate and business assets.

This new direction has seen shares in Blackberry skyrocket since the start of the year with their values on the TSX rising by 15% since January 1.

It seems that Blackberry are starting to end the problems that have plagued the company over the past 12 months but they will need more than just help from outside investors such as Fairfax if they are to stand any chance of being a competitive force in the mobile market.

Did you like this post ? TheTelecomBlog.com publishes daily news, editorial, thoughts, and controversial opinion – you can subscribe by: RSS (click here), or email (click here).

Written by: Andrew Roach www.digitcom.ca. Follow TheTelecomBlog.com by: RSS, Twitter, Facebook, or YouTube

Previous post:

Next post: