Palm raises $313m in share issue

The company will bolster its cash position as it rolls out more WebOS devices
Written by Larry Dignan, Contributor on

On Wednesday, Palm announced it had raised $313m from its public offering of 20 million shares. Palm shares showed strong demand by pricing at $16.25 a share.

Last week, Palm said it would float more shares to bolster its cash position. When the company delivered its first-quarter results, shares bounced around in the $14 (£8.63) to $15 range. All things considered, Palm’s pricing statement was about as good as it gets.

Palm added that its underwriters — Goldman Sachs, JP Morgan and RBC Capital — have a 30-day option to buy three million additional shares. If that option is exercised, Palm stands to acquire a few more dollars out of the deal.

Many companies including banks, airlines and a bevy of others have used the recent stock market run-up to float more shares and bolster their balance sheets.

Palm said it will use the proceeds for working capital and general corporate purposes. As of 31 August, Palm had $212m (£131m) in cash and short-term investments. The additional $313m will come in handy as the company aims to roll out more WebOS devices.

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