BlackBerry CEO Thorsten Heins is reportedly being pushed out along with several board members as BlackBerry abandons its buyout plans and raises a new round of funding instead. The Globe and Mail on Monday morning reported that Fairfax Financial’s planned $4.7 billion BlackBerry buyout will not go through today, which was the deadline for the deal. Other parties were showing interest in a potential buyout, however BlackBerry is reportedly no longer on the table. Instead, the struggling smartphone maker will look to raise $1 billion and right the ship itself. BlackBerry shares plunged more than 18% on the news.

UPDATE: It’s official. Here’s the release:

BlackBerry Receives Investment of U.S. $1 Billion from Fairfax Financial and Other Institutional Investors

John S. Chen to be Appointed Executive Chair of BlackBerry’s Board of Directors and Interim CEO; Prem Watsa to be Appointed Lead Director Company Concludes Review of Strategic Alternatives and Announces Changes to Board and Leadership Team

WATERLOO, ONTARIO and TORONTO, ONTARIO–(Marketwired – Nov 4, 2013) – BlackBerry (BBRY)(BB.TO), a world leader in the mobile communications market, today announced that it has entered into an agreement pursuant to which Fairfax Financial Holdings Limited (“Fairfax”) and other institutional investors (collectively, the “Purchasers”) will invest in BlackBerry through a U.S. $1 billion private placement of convertible debentures. Fairfax has agreed to acquire U.S. $250 million principal amount of the Debentures. The transaction is expected to be completed within the next two weeks.

Under the terms of the transaction, the Purchasers will subscribe for U.S. $1 billion aggregate principal amount of 6% unsecured subordinated convertible debentures (the “Debentures”) convertible into common shares of BlackBerry at a price of U.S. $10.00 per common share (the “Transaction”), a 28.7% premium to the closing price of BlackBerry common shares on November 1, 2013. The Debentures have a term of seven years. Based on the number of common shares currently outstanding, if all of the U.S. $1 billion of Debentures were converted, the common shares issued upon conversion would represent approximately 16% of the common shares outstanding after giving effect to the conversion.

Upon the closing of the transaction, John S. Chen will be appointed Executive Chair of BlackBerry’s Board of Directors and, in that role, will be responsible for the strategic direction, strategic relationships and organizational goals of BlackBerry. Prem Watsa, Chairman and CEO of Fairfax, will be appointed Lead Director and Chair of the Compensation, Nomination and Governance Committee and Thorsten Heins and David Kerr intend to resign from the Board at closing.

In addition, Mr. Heins will step down as Chief Executive Officer at closing and Mr. Chen will serve as Interim Chief Executive Officer pending completion of a search for a new Chief Executive Officer.

Today’s announcement marks the conclusion of the review of strategic alternatives previously announced on August 12, 2013.

“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, Chair of BlackBerry’s Board. “The BlackBerry Board conducted a thorough review of strategic alternatives and pursued the course of action that it concluded is in the best interests of BlackBerry and its constituents, including its shareholders. This financing provides an immediate cash injection on terms favorable to BlackBerry, enhancing our substantial cash position. 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.”

Ms. Stymiest added, “I am also pleased that John Chen, a distinguished and proven leader in the technology industry, has agreed to serve as BlackBerry’s Executive Chairman. I look forward to continuing to serve BlackBerry as a member of its Board of Directors and chair of the Board’s Audit and Risk Management Committee. On behalf of the Board, I would also like to thank Thorsten for his service to BlackBerry over the past six years. Under his leadership, BlackBerry established a more efficient cost structure, developed new products, saw the adoption of BES 10 and delivered the BlackBerry 10 platform. These are all significant accomplishments. We are grateful for his contributions and wish him well in his future endeavors.”

“Fairfax is a long-time supporter, investor and partner to BlackBerry and, with this investment, reinforces its deep commitment to the future success of this company,” said Prem Watsa, Chairman and CEO of Fairfax. “I look forward to rejoining the BlackBerry Board and to working with the other directors and management team, under John Chen’s leadership, to shape the next stage of BlackBerry’s strategy and growth.”

“I am pleased to join a company with as much potential as BlackBerry,” said Mr. Chen. “BlackBerry is an iconic brand with enormous potential – but it’s going to take time, discipline and tough decisions to reclaim our success. I look forward to leading BlackBerry in its turnaround and business model transformation for the benefit of all of its constituencies, including its customers, shareholders and employees.”

The closing of the transaction is subject to customary conditions, including approval from the Toronto Stock Exchange.

Pursuant to the Transaction agreement, the investors have an option to purchase up to an additional U.S. $250 million principal amount of Debentures within 30 days following closing. If an additional U.S. $250 million of Debentures is issued and all U.S. $1.25 billion of Debentures were converted, the common shares issued upon conversion would represent approximately 19.2% of the common shares after giving effect to the conversion, based on the number of common shares currently outstanding.

About John Chen

John Chen previously served as the chairman and CEO of Sybase Inc., beginning in 1998. Under Mr. Chen’s leadership, Sybase was transformed from a mature technology company into a high-growth enterprise data management, data warehousing, mobility management and analytics innovator that was acquired by SAP AG in 2010. At Sybase, Mr. Chen introduced the concept of the “Unwired Enterprise”, extending enterprise applications to mobile users. Prior to Sybase, Mr. Chen held a series of executive positions at Siemens AG, Pyramid Technology Corp., and Burroughs Corp. He started his career as a design engineer with Unisys Corp. Mr. Chen is currently a director of Wells Fargo & Company and The Walt Disney Company.

About Prem Watsa

Prem Watsa is the Chairman of the Board of Directors and the Chief Executive Officer of Fairfax Financial Holdings Limited, a financial services holding company whose corporate objective is to achieve a high rate of return on invested capital and build long-term shareholder value, since 1985. He is also Vice President of Hamblin Watsa Investment Counsel Ltd. since 1985.

J.P. Morgan Securities LLC, Perella Weinberg Partners and RBC Capital Markets are serving as financial advisors to BlackBerry and Skadden, Arps, Slate, Meagher & Flom LLP, Torys LLP and Blake, Cassels & Graydon LLP are serving as legal advisors. BDT & Company, LLC, BofA Merrill Lynch and BMO Capital Markets are acting as financial advisors to Fairfax, and Shearman & Sterling LLP and McCarthy Tétrault LLP are acting as legal advisors. BMO Capital Markets is also acting as the sole bookrunner for the private placement.