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RIM Co-CEOs Step Down, Board Appoints Thorsten Heins

Mon, 01/23/2012 - 7:01am
Andrew Berg

Research In Motion (RIM) Co-CEOs Jim Balsillie and Mike Lazaridis yesterday stepped down from their positions, making room for the company's board of directors to appoint Thorsten Heins as RIM's new president and CEO. Heins was also appointed to RIM's board of directors. The changes will take place immediately.

Lazaridis, former co-chair and co-CEO, has become vice chair of RIM's board and chair of the board's new innovation committee. As vice chair, Lazaridis will work closely with Heins to offer strategic counsel and provide a smooth transition.

Balsillie, who will remain a member of RIM's board, said in a statement that he agrees this is the right time to pass the baton to new leadership. "I have complete confidence in Thorsten, the management team and the company," he said.

Heins joined RIM from Siemens Communications Group in December 2007 as senior vice president for Hardware Engineering and became COO for Product and Sales in August 2011.

In a prepared statement and in an early morning press call, Heins said he's confident in RIM's potential to turn things around. "Mike and Jim took a bold step 18 months ago when RIM purchased QNX to shepherd the transformation of the BlackBerry platform for the next decade," Heins said in a statement.  "We are more confident than ever that was the right path. It is Mike and Jim's continued unwillingness to sacrifice long-term value for short-term gain which has made RIM the great company that it is today."

While investors have been calling for Balisillie and Lazaridis to relinquish their posts for some time now, some wonder whether it might be too little too late.

Michael Walkley, a technology analyst with Canaccord Genuity, reiterated his hold rating and $15 price target on the company's shares.

"While this change in management might positively impact RIM's execution, we maintain our HOLD rating," Walkley wrote in a research note. "With competing OEMs introducing high-end smartphone products on more established software ecosystems and low-cost Android products pressuring RIM's international sales, we believe sales and earnings will decline."

Walkley added that while the change in management might reinvigorate the employee base, improve execution or even increase interest from potential acquirers, Canaccord still maintains that the new BB 10 OS will not stem ongoing market share losses to Android and iOS.

Lazaridis continues to see the positive. "With BlackBerry 7 now out, PlayBook 2.0 shipping in February and BlackBerry 10 expected to ship later this year, the company is entering a new phase," Lazaridis said, "and we felt it was time for a new leader to take it through that phase and beyond.  Jim, the Board and I all agreed that leader should be Thorsten Heins."

Pre-market trading of RIM shares was up, but as of 9 a.m. Central time, shares of the company were down just over 6 percent to $15.97.

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