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
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
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.