Despite being the man who led the charge of the Pre and webOS after a 9 year tenure at Apple, it still came as a bit of a surprise when Palm announced that Jon Rubinstein will be assuming the role as CEO starting tomorrow. After everything Palm has been through, now is when it makes a major change at the top? Taking over the position that has been held by Ed Colligan for the past sixteen years, Rubinstein will be entrusted with ensuring the company stays on the straight and narrow as it attempts to re-establish itself as a major player in the smartphone market. As for Colligan, he will join Roger McNamee at Elevation Partners, a major financial backer of Palm, after a much needed hiatus.
Palm announced today that the equity firm Elevation Partners has agreed to make a new investment in Palm that will total $100 million. Elevation Partners, who purchased 25% of Palm in September 2007, will purchase preferred stock that is convertible into Palm common stock at a price of $3.25 per share, a 31% increase over Palm’s closing stock price last week. Elevation Partners will also receive warrants to purchase seven million shares of common stock at the same price and may be required to sell $49 million of this investment to “other investors” if requested to do so by Palm prior to March 31, 2009. Roger McNamee, co-founder of Elevation Partners, is confident in his company’s investment stating:
We believe that Palm is in a position to transform the cell phone industry, and we are pleased to have the opportunity to make this additional investment in the company. Palm has an industry-leading team and an exciting, differentiated product roadmap. We are proud to be associated with the company and look forward to great things from Palm in 2009 and beyond.
With rumors of a new OS dubbed Nova and a new device on tap for CES, it looks like Palm is gaining some momentum. Wall Street agrees as Palm’s current stock has risen 13% thus far today at the time this post was written.