BlackBerry has completed its US$1bn private placement of convertible debentures to Fairfax Financial Holdings and other institutional investors.
Investors have an option to buy an extra US$250m worth of debentures by mid-December, the Canadian…
BlackBerry has completed its US$1bn private placement of convertible debentures to Fairfax Financial Holdings and other institutional investors.
Investors have an option to buy an extra US$250m worth of debentures by mid-December, the Canadian smartphone maker said.
BMO Capital Markets acted as the sole bookrunner and placement agent for the transaction.
As previously reported, the seven-year, 6% unsecured subordinated debentures will be converted into Blackberry shares at US$10 per common share. If all are converted, they will equate to 16% of the company’s total stock, or 19.2% if the extra US$250m of debentures are also bought and converted.
The transaction forms part of a financing package agreed with Fairfax and other institutional investors in the wake of Fairfax’s unsuccessful US$4.7bn takeover bid for BlackBerry. That deal fell apart after Fairfax failed to persuade other investors to join a lending syndicate. Fairfax and co-investors subsequently sought to inject US$1bn of capital into the company in the form of the convertible debentures. After agreeing this transaction, BlackBerry decided to end the strategic review it launched in August.
