Palm Authorizes 1 for 20 Reverse Stock Split
Palm Inc. announced that the Palm Board of Directors has approved a reverse stock split and established a ratio of 1-for 20. This move followed a vote Oct. 1 at the Palm Annual Shareholders' Meeting in which shareholders authorized the board to effect the reverse split. Palm common stock will begin trading on a reverse-split basis on Oct. 15, 2002.
As a result of the reverse stock split, every 20 shares of Palm common stock will be combined into one share of Palm common stock. The reverse stock split affects all shares of common stock, stock options and warrants of Palm outstanding as of immediately prior to the effective time of the reverse stock split. Palm will pay cash in lieu of fractional shares. The number of shares of Palm common stock currently outstanding is approximately 580 million.
Shares of Palm common stock will trade on the Nasdaq National Stock Market under the symbol "PALMD" for 20 trading days after the reverse split goes into effect. After that period, trading will resume under the current symbol "PALM."
"The decision made by Palm's Board of Directors to complete the planned reverse stock split in October 2002 is timely," said Eric Benhamou, Palm chairman and chief executive officer. "It paves the way for the planned separation of our PalmSource subsidiary. It adjusts Palm's capitalization structure to appropriate levels. And it enables us to attract new investors. Meanwhile, the handheld industry is moving to a new growth phase, Palm's market share is trending up, and we are entering the most comprehensive new product cycle in Palm's history. I am convinced that this decision, combined with continued strong execution by Palm's management team, will contribute to shareholder value creation."
Palm noted that a reverse stock split would allow for an adjustment in the market price of its stock prior to an external separation of PalmSource Inc., which is responsible for the development and licensing of Palm's operating system. Palm already has established internal separation of PalmSource by creating it as a wholly owned subsidiary in December 2001 and by reporting separate financial results since February 2002. Some time in calendar 2003, Palm intends to make the separation external, which would result in shareholders of Palm receiving shares of PalmSource for each share of Palm Inc. owned on the record date. After the distribution of PalmSource shares, Palm shareholders will own shares in both companies. The reverse split will enable Palm to offset the decline in per share price that is normally associated with the separation into two companies.
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never works
RE: never works
Iomega did it successfully - others have too... but yes, the large percentage of reverse-splits fail... let's hope Palm have their ducks all lined up on this one...
Cheers,
RE: never works
However most of the successes came from companies in the same sort of position that Palm is in. Namely the stock being split way to much to start (which always happens during a bubble), a market leading position, a fairly defensible position, and no debt.
My big worries are the negative cash flow and the fact that the new Palm devices seem pretty expensive. The $300 PPCs from Toshiba and coming soon from HP & Dell look to give a higher price/performance than the new Palms. That doesn't seem good to me.
Here's hoping....
-Davy Fields
http://nr70.davyfields.com
RE: Here's hoping....
Does the public really want a Zire with a $100 price tag, which serves as a day planner/organizer (because of its lack of RAM)? The unit may be stylish, like an i-Pod, but at least i-Pod comes out with 5GB at first. Zire's RAM does not even come close to any competition.
The Tungsten's are more promising. But the Zires, forget it!
******************
Lie is the future.
RE: Here's hoping....
RE: Here's hoping....
Eat Ice Cream every day...Im counting on you all to pay for my new PDA. Thank You!
RE: Here's hoping....
They make the best Palm PDAs on the market and will continue to do so. Could be that Sony will buy out the Palm hardware division (for the name) and simply market their stuff under a different name (kind of like I.B.M.).
No doubt HP, Toshiba, Acer, VIA, Fujitsu, NEC, etc....
will be putting up stiff competition with their devices running PPC, but MS is really in a weak spot with their crippled OS (non x-scale optimized) and comparatively low-res screen (there's something I thought would never be associated with PPC!).
refreshing!
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Deja vu all over again...
The last paragraph is repeated.