Struggling smartphone maker BlackBerry has abandoned plans to sell the struggling firm and instead will replace its chief executive and raise $1bn from investors.
Shares of BlackBerry dropped 19% to $6.33 in pre-market trading on Monday, as a result of the announcement by the Canadian company.
The company will raise the money with a private placement of convertible debentures from institutional investors.
BlackBerry’s largest shareholder, Fairfax Financial Holdings Ltd, will take up $250m of the debentures.
Chief executive Thorsten Heins is to be replaced by interim CEO John Chen.
In late September BlackBerry confirmed a loss of $965m (£599m) for the second quarter – much of it down to the failure of its latest handsets.
The figure included a writedown of $934m for unsold phones such as the Z10, one of two devices that were released earlier this year in a high-profile attempt to turn the company around.
But customers have not been impressed with the latest offerings and the firm continues to lose market share to rivals such as Apple and Samsung.
BlackBerry also confirmed plans in mid-September to cut 40% of its global workforce.
It said it would would lay off 4,500 employees in an attempt to slash costs by 50% and shift its focus back to competing mainly for the business customers who are most loyal to the brand.
BlackBerry U-Turn Over Sale As CEO Quits
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