Access Co. Ltd., a Tokyo-based developer of embedded Web browsers for cell phones and other devices, has agreed to acquire PalmSource Inc., the company behind the Palm operating system, the companies said Friday.
The two have signed a definitive agreement under which Access will pay about US$324.3 million for PalmSource. The deal works out to about $18.50 per share, which is a very healthy 83 percent premium on the closing price of PalmSource stock on Thursday.
Access is best known for its NetFront Web browser, which is available in several editions for cell phones and information appliances including: Palm OS, Symbian, Linux, Windows Mobile/Pocket PC and Brew. The company estimates that its browser is in use in over 180 million devices around the world.
Access said it hopes the acquisition will strengthen its hand in the mobile content delivery business and also in Internet access software for mobile devices.
PalmSource was originally the software division of PDA-maker Palm Inc., and was spun off in October 2003.
A year after gaining its independence, the company decided that Linux was the best bet for its future survival and announced plans to move its operating system to the Linux kernel. Shortly after, it announced plans to acquire China MobileSoft Ltd. in order to gain smart phone expertise and also Linux know-how.
Earlier this month, PalmSource formed a partnership with major mobile Linux OS provider MontaVista Software Inc. as part of its Linux efforts.
The boards of both companies have approved the deal, which is expected to be completed by the end of this year pending approval from PalmSource shareholders, the companies said.
News of the deal comes in the same week that another Japanese high-tech company announced a major acquisition in the U.S. On Tuesday, online shopping mall operator Rakuten Inc. said it has agreed to acquire U.S. Internet marketing agency LinkShare Corp. for about $425 million.
LinkShare offers a system through which Web retailers can manage affiliate programs and counts a number of major U.S. companies among its customers.