Abstract

This case is about the acquisition of Sunnyvale based Palm Inc. by the Palo Alto technology giant HP, which was completed in July 2010 amid much debate about the feasibility of the combined entity. It traces Palm's footsteps in the mobile devices and platform industry and describes the circumstances which led to its take-over. It examines in retrospect how Palm, once known for its technological innovations, failed to sustain its acumen and fell back in the race for market share in the growing smartphone segment of the mobile devices industry. The case also takes a look at HP's position in the mobile phone industry and examines the company's failed attempts at establishing itself among the market leaders. It studies the motivation behind the merger deal, from both HP's and Palm's perspective. The case also examines the future of the HP-Palm combined entity and its chances at retrieving lost ground and creating a veritable niche in the smartphone and other mobile devices market.

Learning Objectives

The case is structured to achieve the following Learning Objectives:

• To examine the conditions under which companies in the mobile devices industry opt for merger deals.
• To understand the challenges faced in the smartphone industry.
• To understand the advantages and disadvantages of a merger deal.

Keywords

Strategic options, Mergers and acquisitions, Post merger integration, Culture, Smartphone industry, Hewlett-Packard, Palm, Apple, Google, RIM