{"id":546513,"date":"2010-04-28T16:07:00","date_gmt":"2010-04-28T20:07:00","guid":{"rendered":"http:\/\/www.businessinsider.com\/hp-buying-palm-for-12-billion-2010-4"},"modified":"2010-04-28T16:07:00","modified_gmt":"2010-04-28T20:07:00","slug":"hp-buying-palm-for-1-2-billion-palm-hpq","status":"publish","type":"post","link":"https:\/\/mereja.media\/index\/546513","title":{"rendered":"HP Buying Palm For $1.2 Billion (PALM, HPQ)"},"content":{"rendered":"

\"jon<\/p>\n

Hewlett Packard is buying Palm<\/a> for $1.2 billion, the company announced<\/a> today.<\/p>\n

HP is paying $5.70 per share for Palm, a 23% premium over today’s close. Palm’s stock was trading as high as $18 in the last year.<\/p>\n

Analysis here:<\/strong> “Why HP is buying Palm and why it will fail.”<\/a><\/p>\n

HP will be spending nearly $1 billion in cash. According to data from Capital IQ, HP has $13.6 billion in cash and short term investments. The deal will close in the fiscal third quarter, which ends July 31 2010.<\/p>\n

Palm has been on the block<\/a> for the better part of the year.<\/p>\n

Palm built a nice operating system in WebOS<\/a>, but it failed to catch on. Palm’s market share in the smartphone world has been shrinking.<\/p>\n

Google’s Android operating system passed Palm earlier this year in the US, according to comScore data<\/a>. Palm is in last place.<\/p>\n

Todd Bradley, who is HP EVP of the group that will oversee Palm, was once<\/a> CEO of Palm.<\/p>\n

In the release<\/a> announcing the deal, HP says Palm CEO and chairman Jon Rubinstein is expected to stay with the company.<\/p>\n

Palm’s attempted resurgence was backed by Elevation Partners who put a lot of money into the company<\/a>. Dan Primack of PEHub just tweeted<\/a>, “Back of envelope math shows Elevation would get $485m from HP\/Palm deal. Compared to $460m in. Not even a single, but certainly a save”<\/p>\n

HP explains the purchase in its release, saying Palm provides “an ideal platform to expand HP’s mobility strategy and create a unique HP experience spanning multiple mobile connected devices.”<\/p>\n

It adds, “Palm possesses significant IP assets and has a highly skilled team.”<\/p>\n

Our first take: Look out for the HP tablet running on Palm’s OS.<\/p>\n

See Also:<\/strong> Meet The iPad Rivals<\/a><\/p>\n

Join the conversation about this story »<\/a><\/p>\n

See Also:<\/b><\/p>\n