Elevation Partners, the private equity parent of developer Bioware/Pandemic, purchased a 25 percent stake in the handheld device manufacturer Palm Inc. for approximately $325 million. Existing shareholders will receive a $9 per share payment which will be financed with $400 million in new debt. A group of former Apple executives, including Jon Rubinstein, formerly senior vice president and general manager of Apple's iPod unit and now Executive Chairman, are being brought in to revive the Palm brand. Elevation co-founders Fred Anderson, Apple's former Chief Financial Officer, and Roger McNamee will join Palm's board, increasing the total seats from eight to nine.
Palm, with its once popular handheld devices, has been in decline for years and was expected to be acquired by a larger electronics company. Now that Elevation Partners has bought an influential stake in the company, the potential for porting or developing Bioware/Pandemic titles specifically for Palm mobiles could improve the larger company's chance for survival against Motorola, Nokia and Apple.