14 DAY TRIAL // Sunnyvale-based mobile phone maker Palm was rumored quite a few times before that the Finnish handset vendor Nokia would plan a takeover, and now the rumors have surfaced again. While nothing is yet official on the matter, Palm's shares went up by around 8 percent on Friday, courtesy of these rumors.
“Palm shares jumped and its call volume surged to 9 times their normal level as more than 80,000 call contracts traded by midday on renewed takeover speculation,” is what Frederic Ruffy, option strategist at WhatsTrading.com, a Web information site, stated, according to a recent article on Reuters. Neither Palm nor Nokia have yet commented on the speculations, it seems.
However, some of you might already know that the first speculations regarding the possibility that Nokia may take over Palm have surfaced back in early 2007. According to Reuters, at that time Palm hired Morgan Stanley to analyze options, and was rumored to ask $20 per share. As of Friday, palms shares were priced at $12.34, after climbing 8.1 percent.
“The same speculation has resurfaced this Friday, one week before November options expiration,” Frederic Ruffy reportedly added. “A lot of the activity is in the Palm November call options with some investors opening new positions expecting additional gains while others are closing out positions ahead of next Friday when they go off the board.”
It seems that other companies might also be interested in the purchase of Palm, including Dell Inc, Microsoft Corp and Motorola, but word is that there are little chances we will witness a purchase, since Palm would cost around $2 billion, not to mention other costs related to the acquisition. It seems that licensing Palm's webOS platform would be a better deal, yet one should agree that it is very unlikely for Nokia to make such a move, since it is focused on its own mobile OSes, Symbian and Maemo.