SAN FRANCISCO (AP) -- Palm Inc. a pioneer in the smart phone business that couldn't quite make the comeback it needed, has agreed to be bought out by Hewlett-Packard Co. for about $1 billion in cash.
The two Silicon Valley companies announced Wednesday that the deal will see HP pay $5.70 for every Palm common share. Palm had closed trading Wednesday at $4.63 but traded as high as $18.09 in the past 52 weeks.
Palm was founded in 1992 by Donna Dubinsky and Jeff Hawkins and helped originate the handheld computing market with its Palm Pilots in the 1990s.
In recent years Palm struggled to turn around its smart phone business as consumers flocked to such devices as Apple Inc.'s iPhone and Research In Motion Ltd.'s BlackBerry. More recently, phones that use Google Inc.'s Android operating software added new competition.
Palm got itself into position for a turnaround last year, when it released a sleek, new touch-screen smart phone called the Pre and fresh operating software for it that won good reviews. But consumers still were slow to embrace the Pre and its newer, smaller sibling, the Pixi.