Palm Acquires Extended Systems

Palm Inc. continued its push into the mobile
enterprise space by announcing Tuesday the acquisition of
Extended Systems, a developer of data management and
synchronization products for the enterprise.

Palm said it is paying $22 per share of Extended stock, with the full
transaction valued at about $264 million.

“Palm intends to be as popular with CIOs as it is with individuals,”
said Carl Yankowski, Palm’s CEO in explaining the acquisition. He
noted that the Extended acquisition will enable Palm to deliver
information to users of not just Palm devices but to users of
devices employing other platforms such as Windows CE, EPOC and

On the enterprise side, Palm cited analysts projecting as much as
$1 billion in sales by 2003 of enterprise synchronization servers for
mobile devices, such as those developed by Extended.

By most accounts, including Palm’s, the handhelds initially became popular in the
enterprise not because of information technology (IT) acceptance but because individuals
purchased them and brought them to work. In the last year, Palm has stepped up its
efforts to appeal directly to IT managers.

In a related move, Palm announced the creation of three new groups within the company
that will focus on the enterprise, on individual users and on the Palm platform.

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