Smart phone maker Palm said on June 04 that it was selling a 25 percent stake in the company to private equity firm Elevation Partners in a move aimed at regaining an edge in the competitive market. The deal will give the once-hot Silicon Valley group an injection of 325 million dollars.
Elevation will pay 8.50 dollars per share for a new series of convertible preferred Palm stock. This was calculated to be a 16 percent premium to its average trading price in the past 10 sessions. Palm called the move a "strategic recapitalisation" that will be coupled with 400 million dollars of new debt.
As part of the deal, Jon Rubinstein, a former Apple senior vice president of hardware engineering and head of its iPod division, will join Palm as executive chairman of the board.
Fred Anderson and Roger McNamee, managing directors and co-founders of Elevation, will join Palm's board of directors. Rubinstein, Anderson and McNamee will replace Eric Benhamou and Scott Mercer.
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