BlackBerry co-founder and former CEO Mike Lazaridis has reduced his stake in the company by selling 3.5 million shares earlier this week, indicating that he wants to bail out.
BlackBerry has been struggling in the smartphone industry for the last few years. The Canadian company was one of the prominent players in the handset arena around a decade ago but has now lost a major chunk of its market share to rival companies such as Apple, Samsung, LG, HTC and more.
The company attempted to stage a comeback with the launch of its latest operating system, BlackBerry 10, and its all-touch smartphone, the Z10. The company also launched several QWERTY handsets in 2013. However, the attempts were in vain as the handsets did not attract many customers.
On Friday, December 20, BlackBerry announced its financial results for Q3 of fiscal 2014 ended November 30, posting a loss of $4.4 billion, or $8.37 per share, in the quarter. The company has also written off $1.6 billion as unsold BlackBerry 10 devices.
In October this year, Lazaridis and Douglas E. Fregin, the company's other founder, announced that they were planning to form an investment group to buy BlackBerry. However, in November this year, BlackBerry's directors abandoned their attempts to try and find a new buyer, after the company received $1 billion from a group of investors led by Fairfax Financial Holdings, BlackBerry's largest shareholder. Thorsten Heins, the then CEO, also stepped down to give way to John S. Chen, the former CEO and chairman of Sybase.
Lazaridis reported in a regulatory filing this week that he has sold 3.5 million shares of BlackBerry for about $27.4 million on Monday and Tuesday, December 23 and 24. Before the sale of shares, Lazaridis owned around 5.7 percent of the company and after the share sale, he now owns 4.99 percent stake. Lazaridis did not give any explanation for the share sale.
The company recently announced that it has partnered with contract manufacturer Foxcomm to design and develop its future devices. The shares of the company jumped 16 percent after the announcement. BlackBerry has also released its popular BlackBerry Messenger (BBM) on iOS and Android. The company said the app has been downloaded 40 million times in just 60 days.
Despite the company's weak finances, investors backed BlackBerry, which under the leadership of Chen, is steering away from hardware business to focus more on software business. The jump in share price may have tempted Lazaridis to offload his stake in the company, which effectively means he has given up on his takeover plans.
BlackBerry shares closed up 3.48 percent at $7.73 on the Nasdaq on Tuesday.
