Shareholders approve Palm ownership change

Shareholders of struggling Palm approved the partial sale of the company to a private equity firm and a change in the board's makeup, an Associated Press report said.

The Associated Press report said the proposed changes, designed to infuse new leadership and help the maker of Treo smart phones regain its reputation for innovative products, were announced in June.

Under the capital restructuring, Elevation Partners will pay $325 million in cash for a 25% stake in the company, and Palm will pay a special distribution of $9 per share, or about $940 million in cash, to shareholders for their reduction in ownership, the report said.

Palm will also get a new executive board chair, Jonathan Rubinstein, the former head of Apple's iPod division, after the transaction closes.

Elevation partners Fred Anderson, Apple's former chief financial officer, and Roger McNamee, a veteran Silicon Valley investor, will also join the board, replacing outgoing directors Eric Benhamou and Bruce Dunlevie. D. Scott Mercer, who previously announced his resignation, will remain on the board.

Rubinstein, who ran the iPod division at Apple from 2004 to 2006 and led creation of Apple's iMac computer before that, was part of the executive team that joined Apple after Steve Jobs returned to run the company, the report further said.