Palm Secures $100 Million in Additional Funding

Palm has secured a further US$100 million in funding from rock-star Bono backed investment house, Elevation Partners. Under the terms of the deal, Elevation is to take Series C preferred stock that is convertible into Palm common stock in the future. Elevation will also receive warrants to acquire 7 million shares of Palm common stock at the same price. Prior to March 31, 2009, Palm may elect to cause Elevation to sell up to $49 million of this new investment to other investors on the same or better terms than on which Elevation invested.

Elevation Partners already owns 25% of Palm - after paying US$325 million for the stake last year.

"The additional capital from Elevation Partners will enable us to put added momentum behind the new product introductions scheduled for 2009 and will provide us with enhanced stability in unsettled economic times," said Ed Colligan, president and chief executive officer of Palm, Inc. "Elevation has been a great partner to Palm, and we appreciate their continued confidence and support."

Last week, the firm reported losses of over half a billion dollars.

Elevation Partners is a $1.9 billion private equity firm. Elevation's five partners are Fred Anderson, former EVP and CFO of Apple; Bret Pearlman, former senior managing director of The Blackstone Group; Marc Bodnick, a founding principal of Silver Lake Partners; Roger McNamee, co-founder of Silver Lake Partners and Integral Capital Partners; and Bono, lead singer and co-founder of the rock band U2.

Posted to the site on 22nd December 2008