HP to buy Palm for $1.2 billion

Palo Alto-based IT giant HP has just announced that it will buy out ailing Palm Inc., formerly one of the world's leading manufacturers of mobile computing devices. In a press release posted on the HP website on April 28, the company said that it had already entered into a "definitive agreement" to purchase Palm Inc. at a price of $5.70 per share of common stock in cash for an approximate total enterprise value of $1.2 billion. HP looks to make use of Palm's competencies in manufacturing smartphones powered by the latter's own webOS operating system for mobile devices. "Palm's innovative operating system provides an ideal platform to expand HP's mobility strategy and create a unique HP experience spanning multiple mobile connected devices," said HP Personal Systems Group executive vice president Todd Bradley. "Palm possesses significant IP assets and has a highly skilled team. The smartphone market is large, profitable, and rapidly growing, and companies that can provide an integrated device and experience command a higher share. Advances in mobility are offering significant opportunities, and HP intends to be a leader in this market," he added. HP's buyout follows on the heels of several major setbacks for Palm --including dwindling stock value and sales and management attrition-- apparently driving the last nail into the coffin of what was once one of the leading manufacturers of Personal Digital Assistants (PDAs) and other mobile computing devices. HP's acquisition of Palm is expected to be completed by the end of HP's third fiscal quarter on July 31, 2010. - GMANews.TV