BlackBerry on Monday moved to oust CEO Thorsten Heins while jettisoning a buyout by Fairfax Financial in one fell swoop, as the company struggled to stanch both a market share and stock price in free fall. Just months after a make-or-break launch of a new device fell flat, the embattled smartphone maker—whose attempts at reinvention have done little to restore investor confidence—booted Heins and much of the company's leadership team. In a statement, BlackBerry said that rather than be bought outright by Fairfax, the insurance company and a cohort of "other institutional investors" would invest $1 billion in the company through convertible securities. The deal will be complete within the next two weeks, it added.

BlackBerry CEO Thorsten Heins. Getty Images

"Today's announcement represents a significant vote of confidence in BlackBerry and its future by this group of preeminent, long-term investors," said Barbara Stymiest, BlackBerry's board chairwoman.

"This financing provides an immediate cash injection on terms favorable to BlackBerry, enhancing our substantial cash position," she added. "Some of the most important customers in the world rely on BlackBerry and we are implementing the changes necessary to strengthen the company and ensure we remain a strong and innovative partner for their needs."

(Read more: Sink or Swim Time for RIM as BlackBerry 10 Launch Looms)

Yet the firing of Heins, who first ascended to BlackBerry's top job in January 2012 and will step down at the close of the deal, to be replaced by interim chair John Chen, came as a surprise to many observers. The German-Canadian executive was a six-year veteran of the company, eventually becoming BlackBerry's most public cheerleader. He relentlessly promoted the BlackBerry 10 as a lifeline to the company reviving its fortunes.