Motorola is suing PalmSource for $8.7 million because it claims PalmSource reneged on its $17.25 per share buyout agreement. Japan's Access cast the eventual winning bid of $18.50 per share in an all cash transaction. According to PalmSource's preliminary SEC filings, Access, Motorola, and other handset makers drove the bidding up to Access' $17 per share bid, which Motorola topped with $17.25 per share. Motorola claims PalmSource agreed to its offer; however, Access then made an unsolicited all cash $18.50 bid via email. The termination agreement required PalmSource to pay the $8.7 million termination fee by mid-September.
Access has not officially acquired the company yet, because PalmSource's shareholders have yet to vote on the deal. Some insiders speculate the termination fee could increase because of the delay if the court finds Motorola's request legitimate. Talks of Palm reuniting with PalmSource surrounded the company's sale, but PalmSource's SEC filings show its other half dropped out of the heated bidding war at between $15 and $15.90 per share.
For more on Motorola's lawsuit:
- turn your attention to this blog entry