Palm, the folks who make, well, Palm personal digital assistants (PDAs), has entered into a “definitive agreement” to buy
Extended Systems, a mobile solutions vendor in the enterprise space.
Under the terms of the agreement, Extended Systems’ stockholders will receive shares of Palm valued at US$22 per Extended Systems’ share, subject to a collar described below. The transaction values Extended Systems at approximately $264 million on — for those who speak “stock-ese” — a fully diluted basis.
The acquisition takes Palm beyond its traditional strength serving individual users, to encompass enterprise solutions, according to Carl Yankowski, Palm’s chief executive officer. Extended Systems’ product offerings represent the “glue” that binds the wealth of enterprise applications with easy-to-use handheld computers, which can now be managed by corporate information officers (CIOs), he added.
“Palm intends to be as popular with CIOs as it is with individuals,” said Yankowski in a press announcement. “Palm will be unmatched in its ability to deliver information to individual users and large organizations using a Palm solution or any mobile operating system or handheld device.”
What’s more, Yankowski said the acquisition will make Palm a “unique vendor” that can provide both handheld computers and enterprise-class mobile infrastructure software and support for multiple operating systems, including (naturally) Palm OS, Pocket PC, Windows CE, EPOC, and RIM. And in a related move to sharpen customer focus, Palm has created three strategic business groups: the Enterprise Solutions Group, the Individual Solutions Group, and the Platform Solutions Group.
Extended Systems’ prominence in the mobile enterprise market strengthens Palm’s position, and brings Palm the opportunity to enhance its handheld device business, Extended Systems CEO Steve Simpson said. Plus, for the first time, Palm will be able to sell mobile infrastructure software, services and support.
Beyond Extended Systems’ mobile data management and Bluetooth wireless connectivity products, the acquisition will provide Palm with a strong engineering staff experienced in the enterprise market, as well as a worldwide sales force, strategic partners, and a large installed base of enterprise customers, according to reps at both companies. Those customers include British Airways, International Paper Company, Cadbury Schweppes, Daimler Chrysler, and Orange.
The transaction is subject to regulatory and Extended Systems stockholder approvals, and is expected to close in June.