Smartphone and PDA manufacturer Palm, Inc has been saved following its self-enforced sale earlier this month. The situation had looked bleak after Lenovo and HTC pulled out. Pre and Pixi owners can now relax — HP has entered into a definitive agreement under which it will purchase Palm.
According to the HP press release:
HP and Palm, Inc. today announced that they have entered into a definitive agreement under which HP will purchase Palm, a provider of smartphones powered by the Palm webOS mobile operating system, at a price of $5.70 per share of Palm common stock in cash or an enterprise value of approximately $1.2 billion. The transaction has been approved by the HP and Palm boards of directors.
The combination of HP’s global scale and financial strength with Palm’s unparalleled webOS platform will enhance HP’s ability to participate more aggressively in the fast-growing, highly profitable smartphone and connected mobile device markets. Palm’s unique webOS will allow HP to take advantage of features such as true multitasking and always up-to-date information sharing across applications.
Palm CEO Jon Rubenstein is expected to stay with the company. He commented:
We’re thrilled by HP’s vote of confidence in Palm’s technological leadership, which delivered Palm webOS and iconic products such as the Palm Pre. HP’s longstanding culture of innovation, scale and global operating resources make it the perfect partner to rapidly accelerate the growth of webOS.
The deal offers significant benefits to both companies:
- Palm will survive. They struggled to sell the critically-acclaimed Pre in a market dominated by the Apple iPhone.
- While HP has a long-term relationship with Microsoft to provide Windows-based smartphones, the Palm deal gives them an OS of their own.
HP announced they will invest heavily in Palm’s webOS platform. We’re likely to see it appear in a range of mobile devices including netbooks and iPad-like tablets.