H-P Gambles on Ailing Palm

Hewlett-Packard Co. scooped up Palm Inc. for about $1 billion in cash, pushing the computer giant deeper into the competitive smartphone market and ending the independence of a struggling company that was rapidly running out of prospects.

H-P said it will pay $5.70 for each share of Palm, a 23% premium to Palm's price before the deal was announced. The companies put the value of the deal at $1.2 billion, including Palm's cash and debt.

Palm, a onetime mobile device pioneer with its Palm Pilot, has been eclipsed by Apple Inc.'s iPhone, Research In Motion Ltd.'s BlackBerry and devices running Google Inc.'s Android software. The company recently hired bankers to explore a sale amid weak demand for its newest phones, the Pre and Pixi.

Read Full Article from Wall Street Journal

- Posted: 2010-04-29 10:32:16

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