Access Inc agrees to buy for PalmSource

Listen to this article

00:00
00:00

PalmSource, a software provider for handheld computers and mobile phones, Friday agreed its sale to Access Inc of Japan for $324m - five years after its parent floated in New York with a market value of nearly $54bn.

The sale highlighted the declining influence of Palm, which divided into two companies - palmOne and PalmSource - two years ago to separate its hardware and software businesses.

The price represented an 83 per cent premium on Thursday’s closing Nasdaq price for PalmSource. On Thursday, its shares rose 77 per cent to $17.90.

PalmSource is responsible for the operating system for handheld computers such as the Zire and for mobile phones such as the Treo, both made by palmOne, now renamed as Palm again.

PalmSource has licensed the software to other hardware manufacturers but Palm overall has failed to make the inroads into the mobile phone sector that were anticipated in 2000.

“We are very excited about joining forces with Access to help create a leading provider of software for the mobile market,” said Patrick McVeigh, interim chief executive.

Tokyo-based Access sells web browsing software for mobile phones. Toru Arakawa, chief executive, said its combination with the company and PalmSource’s earlier acquisition of China MobileSoft, a developer of Linux technology, would enable it to provide a comprehensive solution for the mobile sector. Access is offering $18.50 a share in an all-cash transaction that values PalmSource at $324.3m.

The acquisition was also welcomed by Palm Inc, PalmSource’s biggest customer: “Palm’s award-winning user experience and application expertise, combined with Access’s leading software development capabilities, will allow us to continue to deliver great products,” said Ed Colligan, chief executive.

Copyright The Financial Times Limited 2017. All rights reserved. You may share using our article tools. Please don't copy articles from FT.com and redistribute by email or post to the web.