Palm could bring a buyer a decade's worth of digital assistant design and mobile phone know-how, but at a hefty price for a company no longer viewed as cutting edge.
March 7, 2007 (Press Release) --
Treo smartphone maker Palm Inc. (PALM) could bring a buyer a decade's worth of digital assistant design and mobile phone know-how, but at a hefty price for a company no longer viewed as cutting edge.
Shares of Palm rose 11 percent on Friday to as high as $18.08, their highest level in eight months, on renewed speculation that leading mobile phone maker Nokia (NOK) was eyeing the company.
One technology banker who spoke on condition of anonymity said there was potential interest from both strategic and private equity buyers in bidding for Palm.
But the banker said the company's stock run-up made it more challenging for private equity to bid for the company versus strategic bidders, who have more opportunities to cut costs.
"The bigger issue is can you make the acquisition work strategically, grow the revenues and turn Palm into a better competitor," said analyst Tavis McCourt of Morgan Keegan, & Co.
Shares of Palm have vaulted more than 25 percent this year, boosted by persistent rumors it is a takeover target. The rally has lifted Palm's market capitalization to about $1.7 billion, slightly more than total revenue in its last fiscal year, which ended in May 2006.
Palm has long been tossed around as a target. Speculation increased this week when technology news Web site Unstrung said Nokia or a private equity firm may be the leading candidates to buy Palm at around $20 a share, citing unnamed sources.
A Palm spokeswoman said the company does not comment on rumors or speculation and is focused on growing its business.
Motorola Inc. (MOT), the No. 2 handset maker, has also been mentioned as a potential buyer for Sunnyvale, Calif.-based Palm, which makes personal digital assistants as well as a line of mobile phones that keep track of appointments, data and e-mail.
Several analysts questioned why Nokia or Motorola would need Palm, suggesting computer makers like Hewlett-Packard Co. (HPQ) or Dell Inc (DELL) would be more attracted to Palm as a way to break into the market for wireless services.
Smaller phone maker High Tech Computer Corp. of Taiwan could expand using the Palm brand, one analyst said.
CCS Insight analyst Ben Wood said Palm's intellectual property would be attractive to a rival at the right price, but that the company's current share price was too high to spur bids from rivals.
"I don't see there's anybody right now who'd want to pay that much money to add that portfolio of devices to their own," Wood said.
Source: http://www.foxnews.com/
Shares of Palm rose 11 percent on Friday to as high as $18.08, their highest level in eight months, on renewed speculation that leading mobile phone maker Nokia (NOK) was eyeing the company.
One technology banker who spoke on condition of anonymity said there was potential interest from both strategic and private equity buyers in bidding for Palm.
But the banker said the company's stock run-up made it more challenging for private equity to bid for the company versus strategic bidders, who have more opportunities to cut costs.
"The bigger issue is can you make the acquisition work strategically, grow the revenues and turn Palm into a better competitor," said analyst Tavis McCourt of Morgan Keegan, & Co.
Shares of Palm have vaulted more than 25 percent this year, boosted by persistent rumors it is a takeover target. The rally has lifted Palm's market capitalization to about $1.7 billion, slightly more than total revenue in its last fiscal year, which ended in May 2006.
Palm has long been tossed around as a target. Speculation increased this week when technology news Web site Unstrung said Nokia or a private equity firm may be the leading candidates to buy Palm at around $20 a share, citing unnamed sources.
A Palm spokeswoman said the company does not comment on rumors or speculation and is focused on growing its business.
Motorola Inc. (MOT), the No. 2 handset maker, has also been mentioned as a potential buyer for Sunnyvale, Calif.-based Palm, which makes personal digital assistants as well as a line of mobile phones that keep track of appointments, data and e-mail.
Several analysts questioned why Nokia or Motorola would need Palm, suggesting computer makers like Hewlett-Packard Co. (HPQ) or Dell Inc (DELL) would be more attracted to Palm as a way to break into the market for wireless services.
Smaller phone maker High Tech Computer Corp. of Taiwan could expand using the Palm brand, one analyst said.
CCS Insight analyst Ben Wood said Palm's intellectual property would be attractive to a rival at the right price, but that the company's current share price was too high to spur bids from rivals.
"I don't see there's anybody right now who'd want to pay that much money to add that portfolio of devices to their own," Wood said.
Source: http://www.foxnews.com/
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