Beleaguered smartphone manufacturer Palm has been acquired by computer manufacturer HP for a whopping $1.2 billion after the company had been put on for sale earlier this month.
Chinese manufacturer Lenovo emerged as the favourite to buy the company after HTC backed down from the bid only for HP to swoop in and offer a significant premium on yesterday's closing stock price.
At $5.70, the cash offer is significantly more than the $4.63 the company was worth only yesterday but less than half the price it was worth only three months ago and gives HP a very decent set of assets.
HP has an estimated $13.5 billion in cash and short term asset and may encourage HP to revive its range of semi decent iPaq smartphones, which currently run on Windows Mobile.
Whether it will run two concurrent mobile platforms is one of the many questions that this purchase brings up.
The deal, which has been approved by both boards of directors, revolves around what HP calls Palm’s unparalleled webOS platform and is seen by the US tech company as the ideal vehicle to enter the $100 billion connected mobile device market.
Todd Bradley, executive vice president, Personal Systems Group at HP, said in a statement that "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"
Another interesting tidbit gathered from their official statement, Palm's current Chairman and CEO, Jon Rubinstein, is expected to remain with the company but whether he will still be at the helm remains to be seen.