& cplSiteName &

Palm Deal in the Final Stretch

Dan Jones
LR Mobile News Analysis
Dan Jones, Mobile Editor
3/19/2007
50%
50%

A Palm Inc. buyout could be finalized by Thursday this week, demanding $20 or more per share, according to sources close to the situation. Nokia Corp. (NYSE: NOK) is seen as the leading vendor bidder; while Palm's management is said to prefer a private equity buyer.

Morgan Stanley -- the banker that the PDA pioneer has been working with to explore its options -- wants to wrap a deal by the 22nd, the day that Palm is due to report its third quarter results for its 2007 fiscal year, according to the latest word from sources.

"They really want to get it closed on the 22nd," a source told Unstrung on Monday morning.

There are up to four buyers on the hook in all -- two private equity firms and two rival gadget vendors. TPG Inc. is said to be one of the interested private equity firms and it is speculated -- but not certain -- that Silver Lake Partners is the other. (See Palm's in Play .)

As Unstrung has already reported, Nokia Corp. (NYSE: NOK) is the key bidder in the vendor world. The number one handset vendor is said to be considering a bid at $19 to $20 a share. (See Palm Action Heats Up .)

What may surprise some, however, is the talk that Motorola Inc. (NYSE: MOT) has been reconsidering its position and may try to block Nokia with a bid.

Here's why, according to one insider familiar with the thinking: Ron Garriques, the former Motorola Executive VP of the handset business who had been opposed to the deal, left Motorola and is now at Dell Technologies (Nasdaq: DELL). Motorola CEO and Chairman Ed Zander is currently running the day-to-day of Motorola's handset business.

Zander has said that Motorola needs to get out of its low-end price war with Nokia and others and introduce more successful mid-tier and high-end models. "The Treo 680 is doing well, and it is exactly the sort of 'feature-rich phone' that Zander said the company needs to develop to get back some pricing leverage," the source says. (See Palm: The Device Angle.)

The thinking is that a deal for Palm would also help Motorola quiet down billionaire share-holder Carl Icahn, who is trying to grab a seat on Motorola's board. In buying Palm, Motorola could demonstrate that it's not just sitting on its cash, but using it strategically. (See Icahn Buys Moto Shares and The Wrath of Icahn.)

A Motorola buyout would also block Nokia and stop it from acquiring a ready-made stake in the North American enterprise market through a Palm takeover, while repositioning Motorola against BlackBerry in the corporate world. "If they own Palm, all of a sudden Motorola becomes Microsoft's best hope for competing against RIM and Apple."

"It all makes sense," comments a financial analyst who wished to remain nameless (and faceless as well).

A private equity buyout is still said to be Palm management's preferred option, however. Motorola, Nokia, and Palm haven't yet responded to calls for comment.

Palm's stock was up 1.80 percent, or 32 cents a share, at $18.14 in Monday trading on the Nasdaq.

— Dan Jones, Site Editor, Unstrung

(2)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
menexis
50%
50%
menexis,
User Rank: Light Beer
12/5/2012 | 4:03:57 PM
re: Palm Deal in the Final Stretch
It's funny reading this article again, because the Palm Pre is creating a lot of buzz and their stocks are even up because of this
joset01
50%
50%
joset01,
User Rank: Light Beer
12/5/2012 | 4:03:56 PM
re: Palm Deal in the Final Stretch


Watch for a new column tomorrow morning ;-)


 


DJ

Featured Video
From The Founder
Light Reading is spending much of this year digging into the details of how automation technology will impact the comms market, but let's take a moment to also look at how automation is set to overturn the current world order by the middle of the century.
Flash Poll
Upcoming Live Events
November 1, 2017, The Royal Garden Hotel
November 1, 2017, The Montcalm Marble Arch
November 2, 2017, 8 Northumberland Avenue, London, UK
November 2, 2017, 8 Northumberland Avenue – London
November 10, 2017, The Westin Times Square, New York, NY
November 16, 2017, ExCel Centre, London
November 30, 2017, The Westin Times Square
May 14-17, 2018, Austin Convention Center
All Upcoming Live Events
Infographics
With the mobile ecosystem becoming increasingly vulnerable to security threats, AdaptiveMobile has laid out some of the key considerations for the wireless community.
Hot Topics
Muni Policies Stymie Edge Computing
Carol Wilson, Editor-at-large, 10/17/2017
'Brutal' Automation & the Looming Workforce Cull
Iain Morris, News Editor, 10/18/2017
Worried About Bandwidth for 4K? Here Comes 8K!
Aditya Kishore, Practice Leader, Video Transformation, Telco Transformation, 10/17/2017
What Does Automation Mean to You?
Ray Le Maistre, International Group Editor, 10/17/2017
Animals with Phones
Selfie Game Strong Click Here
Latest Comment
Live Digital Audio

Understanding the full experience of women in technology requires starting at the collegiate level (or sooner) and studying the technologies women are involved with, company cultures they're part of and personal experiences of individuals.

During this WiC radio show, we will talk with Nicole Engelbert, the director of Research & Analysis for Ovum Technology and a 23-year telecom industry veteran, about her experiences and perspectives on women in tech. Engelbert covers infrastructure, applications and industries for Ovum, but she is also involved in the research firm's higher education team and has helped colleges and universities globally leverage technology as a strategy for improving recruitment, retention and graduation performance.

She will share her unique insight into the collegiate level, where women pursuing engineering and STEM-related degrees is dwindling. Engelbert will also reveal new, original Ovum research on the topics of artificial intelligence, the Internet of Things, security and augmented reality, as well as discuss what each of those technologies might mean for women in our field. As always, we'll also leave plenty of time to answer all your questions live on the air and chat board.

Like Us on Facebook
Twitter Feed
Partner Perspectives - content from our sponsors
The Mobile Broadband Road Ahead
By Kevin Taylor, for Huawei
All Partner Perspectives