Friday, February 03, 2006

Shareholder urges Palm to put itself up for sale

The San Jose Mercury News reports that Palm's third-largest shareholder, private investor Mark Nelson, who owns about 4 million shares, or 8 percent, urged the company to put itself up for sale. According to the article, it was "the second time in four months that a major Palm shareholder has made such a suggestion. In November, the company's fifth-largest shareholder also urged the company to explore a possible sale."

Neil Strother at NPD Group thought the "Palm executives are probably taking the requests seriously." He said, "While they are doing well, the process to getting with the big leagues is quite a leap."

Smartphones make up only 3 percent of all mobile phones in the United States. Strother added, "Since it's so small, it's so competitive. To be a long-term player you have to have a lot of cash and the ability to innovate and produce those higher volumes."

Will the move to Windows Mobile help Palm?