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.
HP’s press release states, “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.”
MacDailyNews Take: Unparalleled? Puleeze. Somebody grab the shovels.
“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 Todd Bradley, executive vice president, Personal Systems Group, HP, in the press release. “And, 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.”
“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,” said Jon Rubinstein, chairman and chief executive officer, Palm, in the press release. ”We look forward to working with HP to continue to deliver industry-leading mobile experiences to our customers and business partners.”
MacDailyNews Take: Iconic in regard to shoddy build quality, maybe. For such a skinny guy, Jon sure is full of more than his fair share of shit.
Under the terms of the merger agreement, Palm stockholders will receive $5.70 in cash for each share of Palm common stock that they hold at the closing of the merger. The merger consideration takes into account the updated guidance and other financial information being released by Palm this afternoon. The acquisition is subject to customary closing conditions, including the receipt of domestic and foreign regulatory approvals and the approval of Palm’s stockholders. The transaction is expected to close during HP’s third fiscal quarter ending July 31, 2010.
Palm’s current chairman and CEO, Jon Rubinstein, is expected to remain with the company.
Source: Hewlett-Packard Development Company, L.P.
MacDailyNews Take: Here’s what we wrote over 15 months ago, just after beleaguered Palm unveiled their Palm Pre and webOS: “Palm’s Pre dog and pony show is nothing more than takeover bait. They simply do not have the resources necessary to create another mobile platform, especially one that is superfluous. If Palm’s Pre is not a ruse, then those responsible are kidding themselves.” – MacDailyNews Take, January 21, 2009
Okay, so who’s salivating over an HP webOS phone and/or slate PC with no ecosystem of which to speak? That’s right, no one who doesn’t look forward to spending at least 24 hours cooped up alone inside the server room. iPaq.
Now, we need another prescient quote to which we can repeatedly refer going forward, so here:
HP’s acquisition of Palm means that not only is HP sick and tired of being stuck with and dependent upon perpetual laggard Microsoft, but, more importantly, yet another smartphone/slate PC OS will live to confuse the market. This will significantly benefit the one company that has repeatedly proven its ability to distinguish itself above all others: Apple. The more confused the marketplace, the faster customers will flock to Apple’s trusted brand and quality products.
Have a nice evening, Microsoft and Google. You, too, RIM and Nokia.
Here are some fun quotes we’ve iCal’ed over the years:
• We’ve learned and struggled for a few years here figuring out how to make a decent phone. PC guys are not going to just figure this out. They’re not going to just walk in. – Palm CEO Ed Colligan, November 20, 2006
• Why would we price ‘Pre’ less than iPhone when we have a significantly better product? – Palm CEO Ed Colligan, January 10, 2009
• June 29, 2009 is the two-year anniversary of the first shipment of the iPhone. Not one of those people will still be using an iPhone a month later. – Palm backer Roger McNamee, March 05, 2009