BlackBerry completes $1 billion investment through debentures
New York: Smartphone maker BlackBerry said it has concluded the private placement of debentures worth $1 billion with Prem Watsa-led Fairfax Financial Holdings and other institutional investors. The investors also have an option to purchase additional $250 million worth of debentures in 30 days. The struggling Canadian handset maker had earlier this month scrapped a sale plan and said it would instead raise as much as $1.25 billion through convertible debentures, which it intends to use for general corporate purposes.
In a regulatory filing to the US Securities and Exchange Commission (SEC), BlackBerry said: "It has completed the previously-announced $1 billion private placement of convertible debentures to Fairfax Financial Holdings Ltd and other institutional investors." BMO Capital Markets acted as the sole bookrunner and sole placement agent for the private placement of the debentures, the filing, which was filed yesterday, it added.
"As previously announced, the investors have an option to purchase up to an additional $250 million principal amount of additional debentures within 30 days," the firm said. In a previous SEC filing this month, BlackBerry said that Fairfax, which signed a tentative agreement in September to acquire it for $4.7 billion, will invest $250 million in convertible debentures. Fairfax holds 10 per cent in the firm. Besides, Mackenzie Financial Corporation will purchase debentures worth $200 million, Canso Investment Counsel ($300 million), Markel Corporation ($70 million), Brookfield Asset Management ($10 million), Qatar Holding ($100 million).
Fairfax, Mackenzie, Canso, Markel, Brookfield and Qatar Holding are termed as the 'Original Purchasers' -- the firms with which BlackBerry entered into a Subscription Agreement on November 4, 2013, the filing had said. Once a dominant player in the handset market, BlackBerry has been losing its market share to rivals.