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HTC Out, Lenovo Still in as Palm Suitors

palm for sale Word on rumor street today is that HTC has taken a hard look at Palm and has decided to pass on an offer according to a new article on Reuters. A source close to the discussions reportedly remarked "There just weren't enough synergies to take the deal forward."

This development follows earlier reports from last week that Dell and Huawei also reached similar conclusions. However, the rumor report still leave the door open for Lenovo (or another Chinese mainland company), which kicked off the much of the recent Palm is for sale stories earlier this month. Palm nor Lenovo both declined to comment for the Reuters piece.

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Where is Palm manufactured?

e_tellurian @ 4/23/2010 9:01:57 AM # Q
Is the synergy that exists with Palm and China that Palm is manufactured there? If Palm was manufactured in North America would there be more synergy?

Palms brand is undervalued yet North America still does not seem to be able to afford Palm. The stock is doing better and one would hope that it is a result of people thinking about what Palm could do in the future and not just that they are for sale. Let's hope Palm stays an independent North America brand that can make hardware and software.

Does North America have a manufacturing facility that can work with high tech and precious metal to build hardware? It seems that most hardware is made of plastic even after many years plastic is still used to make hardware. One would think that hardware would evolve too and use other material. Can a North American brand pay more to make their product as they can then sell that product with enhanced value globally? What does Palms stock have to be valued at to enhance the hardware material?

Just some thoughts to kick around.

E-T
e-tellurian

Completing the e-com circle with a people driven we-com solution
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Lenovo, Palm suitor?

philpalm @ 4/23/2010 9:33:28 AM # Q
I wonder if Palm still has the "foleo " project ongoing? My hopes for a foleo springs anew...
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Lenovo is no more 'in' than they were before

SeldomVisitor @ 4/23/2010 9:54:58 AM # Q
Gotta keep these rumors and rumor-renewals right!

RE: Lenovo is no more 'in' than they were before
jca666us @ 4/24/2010 4:32:20 AM # M Q
Palm's running on fumes right now; the only thing keeping the stock price up at it's current levels are rumors.


RE: Lenovo is no more 'in' than they were before
nastebu @ 4/24/2010 5:11:13 AM # Q
The stock price, yes, but they are still solvent, no? They have enough cash for how long? At least to get more products out? And if there is no buyer, what is their best strategy at this point? Is it all or nothing?
RE: Lenovo is no more 'in' than they were before
SeldomVisitor @ 4/24/2010 5:58:14 AM # Q
They are estimated tol have about $400 million in cash at the end of this quarter (end of May) since their cash burn this quarter INCLUDES the actual cash burn from last quarter. They apparently burn about $100 million per quarter, plus or minus, so the remaining cash gets used up in 4 quarters, all other things being equal. It is NOT known (at least, not overtly know) how picky their creditors are about cash remaining; Palm is in debt of about $400 million, those creditors may not want to see Palm's cash position go too low since they probably (...) want some assurance they'll get paid back.

That means we don't really have a good handle on how long Palm can hang around all else being equal.

Note - Palm, of course, would already be THOROUGHLY out of business had they not received the three (more?) injections of cash they have received since Dec 2008. Those injections of cash didn't really cost Palm anything (just the shareholders!); doing real business DOES cost Palm real money, however.

RE: Lenovo is no more 'in' than they were before
Fake Jeff Hawkins @ 4/25/2010 9:35:11 AM # Q

Palm's burn rate is sustainable for another year, but their current business plan is on life support. Just because you CAN keep something alive by throwing money down the drain doesn't mean it's a good idea. Palm needs to have a completely revitalized product line, with hardware equal to or surpassing the likes of the iPhone, Droid and EVO and to then advertise it properly. They also need to finish developing webOS and finally get it out of its current beta stage. Only after these things are done will Palm be realistically ready to compete. The problem is that to do things takes the kind of resources that Palm lacks: money and effective leadership. It would probaby require an additional $500 million to build and properly launch a new product line and give Palm a fighting chance. Doing it on the cheap has devalued Palm's name and damaged its carrier relations. It is difficult to comprehend how Palm could have so thoroughly mismanaged the past year unless either:

a) they were certain that they would have been bought out one year ago and only needed to produce the Pre and beta version of webOS as "proof of concept" for a better financed suitor to then invest its resources in properly developing and marketing; or

b) someone at Palm is intentionally mismanaging the company in an effort to devalue it and set the stage for an inexpensive takeover.

Palm was cash rich prior to the Elevation Partners deal, so had the deal not been made Palm could have remained in business for a few years even without the additional "allowance" that EP has provided over the past year. All things considered, Palm would have been far better off had they been purchased by hardware company with the means to produce and market its own devices. Several of us with close ties to Palm gave them this advice a long time ago, but they kept holding out for more money. And so it goes.

FJH
- Foleo advocate, latter day Paul Revere, canary in a coalmine

RE: Lenovo is no more 'in' than they were before
hkklife @ 4/25/2010 3:59:13 PM # Q
Being a Doubting Thomas (aka "Palm Pessimist") my vote is for both A&B.

I have said here and elsewhere for quite a while that the DEAFENING silence out of Palm in the immediate aftermath of the huge CES '09 hoopla speaks volumes. January 9th to June 6th was a loooong time in the smartphone world. The period from June 6th to January 25th might as well have been an eternity as far as Palm's glacial rollout in the face of brutal new competition from Apple/Google/HTC. Now WiMax is here, LTE is going to be a buzzword before you know it and smartphones are approaching commodity status.

I still maintain that throughout the first 9 months of 2009, Ruby + EP & co. fully expected the alpha/beta Pre & WebOS to be enough to make some rabid, cash-rich company (likely an Asian firm such as Huawei, Asus, Lenovo or Acer desiring an immediate presence in the US market) to overpay for Palm. Only when those suitors didn't come out of the woodwork did they start to do anything more than casually draw up a roadmap for 2010 onwards. Thus the delayed 3D gaming APIs (why not show a quick Need for Speed demo at CES '09 and get an even bigger buzz?), and the interminable delays in the AT&T, Verizon, and unlocked GSM Pre releases. Thus the lack of new hardware for the forseeable future. Thus the lack of major updates to WebOS. Thus the inventory glut and heavy discounting by VZW mere weeks after their WebOS launch.
Pilot 1000->Pilot 5000->PalmPilot Pro->IIIe->Vx->m505->T|T->T|T2->T|C->T|T3->T|T5->Zodiac 2->TX->Verizon Treo 700P->Verizon Treo 755p->Verizon Moto Droid + Verizon Palm Centro

RE: Lenovo is no more 'in' than they were before
jca666us @ 4/25/2010 5:52:29 PM # Q
I have said here and elsewhere for quite a while that the DEAFENING silence out of Palm in the immediate aftermath of the huge CES '09 hoopla speaks volumes. January 9th to June 6th was a loooong time in the smartphone world.

Palm put the hardware together too soon - I read an interview where Rubinstein mentioned they squeezed the Pre out in a 18 or 19 month timeframe - when it usually takes 24 months.

An additional six months would have allowed them to spec. better parts, tighten up the design, and improve the build quality, not to mention what could have been improved with webos, in addition to a lengthy QA cycle.

Thus the delayed 3D gaming APIs (why not show a quick Need for Speed demo at CES '09 and get an even bigger buzz?)

Building a mobile OS from scratch takes time (even one based on linux), and their intent was to get something to market ASAP - which explains the gaps in functionality (and the bloated codebase).

Thus the lack of new hardware for the forseeable future. Thus the lack of major updates to WebOS. Thus the inventory glut and heavy discounting by VZW mere weeks after their WebOS launch.

Palm was selling a good amount of Pres, until users saw the crappy build quality and the slow/buggy webos, and the lack of apps. Sales sales started to tank - which contributed to the inventory glut.

The lame-ass ad campaign didn't help, neither did Rubinstein's moronic itunes sync "battle" with Apple.

Considering HTC isn't interested in buying Palm, it certainly puts into question the value of Palm's patent portfolio.

RE: Lenovo is no more 'in' than they were before
nastebu @ 4/25/2010 7:36:54 PM # Q
One more question: how would a falling stock price impact how long Palm can stay in business?

From SV's comments on creditor's patience, I would thank that if the stock price tanks, the creditors are going to get very impatient very fast on the assumption that the company is walking dead and so any value needs to be extracted now. Is that so?

RE: Lenovo is no more 'in' than they were before
SeldomVisitor @ 4/26/2010 3:42:08 AM # Q
IMH-and-paranoid-O, some Big Guy has been supporting the price continuously for quite some time - when the price got BELOW $4 someone using the market maker ISEG (International Securities Exchange, an options house among other things) started placing relatively large bids on the Inside Bid (or right below that). Those essentially served/serve as a wall over which anyone wanting to buy has to bid. What was interesting is these bids weren't raised the single penny needed to get the trade AND the bids, if sold through, reappeared again a penny or so lower. This doesn't feel to THIS observer like some Big Guy buying in, but instead some Big Guy stopping a drop.

Note - I don't do stock options but wouldn't be surprised if some related activity is going on with them, too.

Someone who is more into the sinister side of the market can explain how someone can buy a few million dollars worth of stock to stop a drop yet end even at the end of the day...


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