Palm, Handspring Merger Clears Antitrust Hurdle

Two of the biggest names in the wireless PDA convergence space moved a
step closer to merging Friday with an announcement from Milpitas,
Calif.-based Palm that the antitrust waiting period for
its purchase of Handspring had expired.

The expiration of the waiting period required by the Hart-Scott-Rodino
Anti-Trust Improvements Act clears the way for the closing of the $169 million
stock swap deal
hammered out between the former rivals earlier this
year.

The acquisition is expected to close in the fall, subject to certain
conditions, including approval from both companies’ stockholders, Palm said
in a brief statement.

Palm Solutions CEO Todd Bradley, who will lead the combined
Palm/Handspring unit, said the passing of the antitrust waiting period
clears the way for the creation of a firm providing the “broadest portfolio
of mobile computing and communications solutions from the most-experienced
leadership team in the industry.”

Even as analysts continue
to express concerns
about the fundamentals of both companies, the
eventual merger of two former bitter competitors is sure to mark a definite
shift in the crowded PDA market.

The completion of the merger could not come at a better time for Palm,
which competes head-on with the likes of Microsoft, Hewlett-Packard, Sony
and the embattled Research in Motion (RIM)

Earlier this week, a U.S. District Judge ordered RIM to stop selling its
flagship BlackBerry handheld devices in the U.S. — its largest market —
because technology within the two-way pagers infringed on patents owned by
Virginia-based NTP Inc.

The judge then delayed the impact of the ruling to allow RIM to file an
appeal and ordered the company to pay approximately $54 million in damages
and legal fees to NTP. But, even though RIM can continue marketing
Blackberry devices in the U.S., analysts believe the “fear and uncertainty”
could open the
doors
for RIM’s competitors, especially Palm.

Palm and Handspring both license
certain patents
own by RIM for its thumb-operated (QWERTY) keyboard
technology.

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