Palm to acquire wireless software company by CNET -
12/12/2001 Palm to acquire wireless software company
By Ian Fried
Staff Writer, CNET News.com
December 12, 2001, 8:30 a.m. PT
For the second time this year, handheld giant Palm has announced an acquisition aimed at boosting its ability to help corporations make handhelds a key part of their business.
Palm said on Wednesday that it plans to buy New York-based ThinAirApps, a privately held company whose software allows secure wireless access to corporate e-mail and other critical business data. Santa Clara, Calif.-based Palm said it will pay $19 million in stock and expects the deal to close by the end of this year.
The move follows Palm's failed bid to buy Extended Systems, which has its own server-based approach to providing access to corporate data on handhelds and other wireless devices. That deal collapsed after a steep drop in Palm's share price, which led both sides to call off the acquisition.
The handheld company had promised that it would deliver a handheld with "always on" access to corporate e-mail this year. However, despite winning regulatory approval for such a device, Palm has delayed its introduction until early next year.
Palm said ThinAirApps will become part of its "solutions" group, the part of the company that makes and sells Palm-branded handhelds. By year's end, Palm plans to create a separate subsidiary for the unit that develops and licenses the Palm operating system.
"Acquiring ThinAirApps is a linchpin of our long-term enterprise and wireless strategies," Todd Bradley, chief operating officer of Palm's solutions group, said in a statement.
Bradley said that the acquisition, combined with Palm's earlier purchase of Actual Software, will give the handheld maker both the server-based and handheld-based software needed to provide corporate e-mail on its new wireless devices.
Palm has been working with ThinAirApps over the last year to develop the server software to make that next-generation wireless device a reality.
Offering ready-to-go options for businesses is seen as critical to getting companies to buy large numbers of handhelds for their workers. The push for the corporate market has also become a key battleground with Microsoft and its Pocket PC operating system. Palm OS licensee Handspring also recently stepped up its efforts aimed at corporate customers.
Palm said it expects most of ThinAirApps' employees to continue with Palm, including the software maker's engineering team.
Last week, an unnamed investor provided Palm $50 million in financing though a convertible bond. In recent weeks, Palm has also seen the departure of CEO Carl Yankowski and another round of layoffs.