Palm Can Survive, CEO Says: Report
Story updated with responses from Palm & Lenovo.
SUNNYVALE, Calif. (
) --
Palm
(PALM)
is confident of its ability to survive as an independent entity, according to its CEO, despite a rumor citing
Lenovo
as a leading potential buyer.
Earlier this year, Palm gave a
, citing
weak demand for its Pre and Pixi phones
, and a big question mark hangs over the company's future.
Palm CEO Jon Rubinstein |
Struggling against
Apple
(AAPL) - Get Report
,
Nokia
(NOK) - Get Report
,
Motorola
(MOT)
and
Research In Motion
(RIMM)
in the highly competitive smartphone market, there has been
that Palm had hired bankers to scope out suitors. Companies rumored to be potential buyers included Taiwan's
HTC
, China's Lenovo Group and
ZTE Corp
, as well as Finnish giant Nokia.
However, Palm CEO Jon Rubinstein told the
this week that he is "bullish" about his firm's long-term prospects. "I believe Palm can survive as an independent company," he added. "We have a plan that gets us to profitability."
Palm, which partners with
Sprint
(S) - Get Report
,
Verizon
(VZ) - Get Report
, and
AT&T
(T) - Get Report
, would nonetheless sell if it received the right bid, according to Rubinstein.
"If someone comes to the board with a reasonable offer, of course it's something we have to consider," he said, but would not confirm whether Palm had hired bankers.
Citing investment banking sources, however,
reported on Friday that Lenovo has emerged as the leading candidate to buy Palm. Both Palm and Lenovo declined to comment on this story.
With the company again in the spotlight, Palm shares surged 23 cents, or 4.73%, to $5.09 in early trading on Friday, far outpacing the modest advance in tech stocks that saw the
Nasdaq
gain 0.16%.
In a recent poll, some 65% of readers surveyed by
TheStreet
said that
a deal for Palm is likely
although many doubted the company's ability to command a $1.7 billion minimum price tag, as estimated by RBC Capital Markets.
One major weapon in Palm's armory, however, remains its highly-respected
WebOS
operating system,
fuelling talk that this could be licensed to other phone manufacturers
.
Rubinstein told the
FT
that he would consider licensing the WebOS if the "appropriate strategic relationship" or business deal arose. "Obviously the more scale we get the more the benefit there is to us," he added.
-- Reported by James Rogers in New York
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