As no buyers stepped up to buy Blackberry, a new strategy—likely the last strategy— is to bring in John Chen. Chen has had experience turning around tech companies like Sybase, selling it eventually to SAP for $6 billion. Chen will receive a yearly compensation of a $3 million salary plus a restricted share bonus worth about $100 million dollars when he signed the deal on Monday November 3rd. If the shares go up to $20 his compensation will be worth approximately $250 million.
On the surface it may seem like a lot of money—and it is— however, if he is successful, Blackberry shareholders will be happy to pay him the $250million. With a current market cap of approximately $3.4 billion Blackberry’s market cap will grow to $10.3 billion if Chen can move the the share price to $20 per share. Paying Chen the $250 million may not be a bad investment because at $20 a share Blackberry will be worth an additional $7 billion! This is a huge gamble but at this stage it is Blackberry’s last chance to survive in the market and hopefully they will be successful for the sake of the shareholders that have invested into Blackberry.
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