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Stock plummets as Blackberry’s dream to go private crash

 Stock plummets as Blackberry’s dream to go private crash

Nothing ever lasts in this world forever and technology companies have to deal with tough competition to sustain in this hungry market. Constant upgrades, user friendly, innovation, cutting tasks, fun, better service, availability, suave design, vibrant, colourful, attention grabbing and much more is required to be a market leader. They have to convert each and every buyer to a brand slave or they will never stick around because they will eventually get bored.
That is exactly what happened with Blackberry. The buyers got bored gradually, the Fairfax financials $US 4.7 billion deal to take over Blackberry private didn’t go through, CEO Thorsten Heins resigned, and the stock plummeted 18.5% in pre-market trading.
Blackberry announced that an agreement has been entered with Fairfax Financials and other investors to invest $US 1 billion through private placement of convertible debentures. Fairfax has approved to obtain $US 250 million principal amount of debentures. The deal will be concluded within two weeks. John S. Chen will be the Executive Chair of Blackberry’s Board of Directors, once the deal is closed. His job will entail strategy and organisational targets of Blackberry. Prem Watsa the current Chairman and CEO of Fairfax, will be the Lead Director, Chair of the compensation, nomination and governance committee.
Blackberry still has a significant share of users in the market, but they are mostly middle aged corporate sector. The youth market is looking for constant change and better products. It is very hard to make them your fan, but if you succeed, you will have to keep performing and entertaining them with new acrobats. So let’s see what new strategies Blackberry adapts to keep afloat in the market.

Pradip Atluri

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