PalmSource Agrees to Buyout by Japan’s Access

Access Co. Ltd., a Japanese information equipment software developer, said Friday that it will acquire PalmSource Inc., makers of the Palm operating system, for US$324 million. PalmSource will merge with the U.S. unit of Access to form a wholly owned subsidiary.

The boards of both companies have approved the deal, which is expected to be completed by the end of this year pending approval from PalmSource shareholders, the companies said.

Palm OS is used in more than 39 million mobile devices, including the Palm hand-held computer and mobile phones. PalmSource was originally the software division of PDA-maker Palm Inc., and was spun off in October 2003.

Tokyo-based Access markets the NetFront Internet browser, widely recognized as one of the most advanced Internet browsers, and provides Internet technologies to mobile and other markets. NetFront technologies are being used in next-generation mobile devices and consumer electronics products, including digital TVs and Net-linking functions in cars called telematics.

More than 45 companies worldwide, including Palm, Japanese electronics and entertainment company Sony Corp., South Korean electronics company Samsung, Kyocera and Lenovo, have licensed PalmSource software.

The acquisition of PalmSource is expected to help Access expand its business as a provider of mobile content delivery and Internet access software for mobile devices worldwide, gaining expertise and development sources for mobile devices in the U.S., France and China for the Linux open-source operating system.

"PalmSource is a global leader in mobile device software and the developer of the well known Palm OS operating system," said Toru Arakawa, Access chief executive. "We are very excited about joining forces with ACCESS to help create a leading provider of software for the mobile market," said Patrick McVeigh, interim chief executive of PalmSource. "We believe the customer and technology synergies of the combined companies will open up new market opportunities for both companies worldwide."

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