Palm Bake Sale a Resounding Success
Palm’s decision to increase the size of its previously announced public offering of common stock to about 23.125 million shares from 18.5 million shares turned out to be a wise one. The value of the company’s stock rose sharply this morning, topping out at around $6.85–an increase of well over 13 percent. Clearly, the $83.9 million Palm (PALM) netted from the sale went a long way toward reassuring investors that it can afford to give the Pre the strong launch it deserves. And make no mistake, that launch will be costly. Consulting firm Altman Vilandrie & Co. estimates that Palm will have to spend between $50 million to $75 million to have a decent number of phones ready for the Pre’s debut and up to $50 million to market it. That $83.9 million’s going to come in handy.