Nokia rumoured to be circling Palm

Nokia rumoured to be circling Palm

Shares in Palm jumped 13% in Frankfurt today on the back of rumours that Nokia may buy the Californian handset manufacturer.

Further speculation that investors will like Palm’s planned stock offering gave the US mobile manufacturer’s shares additional momentum.

Both Nokia and Palm declined to comment on the rumours.

US analysts said any deal between the two would give Nokia a firmer foothold in the US market and give Palm greater financial muscle. Nokia has been looking to break into the US market for sometime, where it has less than 10% share compared to 40% globally.

Matt Thornton, telecoms analyst at US firm Avian, told Mobile: ‘Acquiring Palm would be a great way for Nokia to bolster its share of the North American market and give them a competitive smartphone platform to challenge Apple and Android.’

He added: ‘For Palm any deal with Nokia will bring plenty of scale, lots of distribution and a bigger balance sheet to grow its assets faster.’

However Thornton said Nokia might baulk at Palm’s $4bn dollar price tag, particularly in the current market. He added that the challenges of integrating managerial and cultural styles and the integration of services and applications across the OVI and WebOS platforms could also deter any deal.

Written by Mobile Today
Mobile Today

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