Handspring (Nasdaq: HAND) rose 96 U.S. cents to $14.06 in morning trading Wednesday, following news that the handheldcomputer maker will be able to develop and market products based on the Palm(Nasdaq: PALM) operating system for another two years.
Financial terms of the agreement between the two computer makers were notdisclosed. The deal lets Handspring continue to work with the Palm OSthrough April 2009, the companies said. The two also saidthey will collaborate on improvements to the system.
“Handspring is a great platform partner,” said Alan Kessler, generalmanager of Palm’s platform solutions group. “We are excited about ourefforts to expand the Palm OS, making mobile and wireless handhelds pervasive across consumer,business and education solutions.”
Handspring chairman and chief product officer Jeff Hawkins said the licenseextension “guarantees that Palm and Handspring will continue to worktogether to refine and enhance the Palm OS so that it will meet the needs of therapidly changing mobile computing market.”
Handspring, a company started by former Palm executives, went public a yearago. The company’s fortunes remain tied to those of Palm, and last month,Handspring shares took a plunge after Palm lowered its outlook for quarterly results. The dropcame even as Handspring reaffirmed its financial targets for the year endingJune 30th.
Palm, meanwhile, last month said it would lay off about 250 employees andcontract workers, and postponed construction of a new headquarters building.
Handspring’s Visor line of products competes with the PalmPilot.