Struggling smartphone maker BlackBerry fired its chief executive yesterday and abandoned a
The company said it would raise
BlackBerry did not say why it was trying to raise the extra money amid predictions that it will burn through its
"This does look like panic stations," said Neil Mawston, executive director at the research company Strategy Analytics. "The trouble is that when a company's in that downward spiral, nobody wants to catch a falling knife - so operators don't want to work with them, and retailers don't want the stock."
"I know we have enough ingredients to build a long-term sustainable business. I have done this before and seen the same movie before," he said. "BlackBerry is an iconic brand with enormous potential - but it's going to take time, discipline and tough decisions to reclaim our success."
BlackBerry shares plunged by 13% to
There are growing expectations that the handset business will be severely cut back after the market failure of the new BB10 handsets. "BlackBerry needs to use the new cash infusion to change its market approach [to one] where saving the devices business is not the main priority," said
But analysts remained sceptical about the future of the firm formerly known as Research in Motion. "If you wouldn't lend money to buy BlackBerry, why would you lend money to BlackBerry?" asked
BlackBerry was believed to have held talks with a number of companies while Fairfax said it was working on its bid. The bid was announced on 23 September, just after the company had announced disastrous results with a second-quarter loss of
Among the companies that BlackBerry is understood to have spoken to about a buyout are
"Looks like nobody was interested in buying BlackBerry outright," commented
Having concluded a strategic review with yesterday's short statement, BlackBerry must now rely on the
The company's cash position could also be hit if suppliers begin demanding payments on shorter terms, which would mean paying cash for components before they can be sold as finished items. One major supplier, Jabil, warned in September that it might stop building parts for the company, which could kill off the handset business.
Most Popular Stories
- Adam Levine Wins Big as 'The Voice' Crowns Champ
- Target Security Breach May Affect 40 Million Cardholders
- 'Beyonce' Tops the U.S. Album Chart
- Tyson Foods Charged With Civil Rights Violation
- Archer Daniels Midland Moving HQ to Chicago
- Bernanke Lets Congress Have It in Final Press Conference
- Wall Street Falls a Day After Surge
- Texting With Vodka: Booze and Social Media Can Mix After All
- Existing Home Sales Drop for 3rd Month
- Hispanic PR Firm Launches Chicago Chapter