Palm announces job cuts
Published: 15 Jun 2007 08:08 BST
Days after announcing plans to sell a stake in the company to a venture capital firm, handheld maker Palm cut an unspecified number of jobs on Thursday.
Workers were still in the process of being notified of the cuts on Thursday afternoon. Some cuts are being made immediately, while others will take longer to implement, said Palm spokesman Jim Christensen.
Evolution of Palm
January 1992
Jeff Hawkins launches Palm Computing
September 1995
USRobotics acquires Palm Computing
May 1997
3Com acquires USRobotics, in the process gaining Palm
March 2000
Palm is spun off from 3Com as a separate public company
November 2001
Palm announces plans to spin off its operating system unit as a separate public company
June 2003
Palm announces plans to buy Handspring
October 2003
Operating system subsidiary PalmSource is spun off; Palm is renamed PalmOne
December 2006
Palm reacquires the rights to make changes to Palm OS from Access
June 2007
Palm announces an equity investment from Elevation Partners
"It's a small percentage of our work force," said Christensen, adding that Palm still has openings in some areas. The bulk of the jobs being eliminated are in the US and in Palm's development ranks, though there are some cuts across the company, he said.
Christensen said the move was "not about cost-cutting" but rather about "eliminating some of the hierarchy" at the company.
The move comes less than two weeks after the company announced its plans to sell a stake in the company to Elevation Partners. In the unusual transaction, the venture firm is pouring $325m (£164m) into the company, which, at the same time, plans to borrow another $400m (£203m) and return more than $900m (£456m) in cash to its shareholders. When all is said and done, Palm shareholders will get $9 (£4.5) a share in cash while collectively owning 75 percent of the company, while Elevation will hold a 25 percent stake.
The deal followed months of speculation that Palm might sell itself amid growing competition in the smartphone market in which its flagship Treo competes. Late last month, Palm also announced plans for the Foleo, a mini-laptop designed as a companion for smartphone owners that want to engage in more heavy e-mail editing and web surfing.
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