Handheld device maker PalmOne Inc. is paying Palm operating system provider PalmSource Inc. $30 million for the rights to the Palm Inc. moniker.
After the two companies split as Palm Inc. in 2001, each held equal shares in the Palm Trademark Holding Company. PalmOne will now hold a 55 percent stake in the company and will take on the Palm name later this year.
The move comes on the heels of PalmSource CEO David Nagels abrupt resignation earlier this week. PalmSource officials would not comment on why Nagel is leaving the company.
Nagel, 60, will remain at PalmSource in an advisory role until July, while Patrick McVeigh, 53, senior vice president for worldwide licensing, will step up as interim CEO.
PalmOne also said today it would renew its license with PalmSource to use the Palm OS in devices through 2009.
As part of that deal PalmOne will pay PalmSource royalties of at least $148.5 million, provided that PalmSource meets "certain development milestones." Neither company, however, clarified what those milestones are.
Some insiders predict PalmOne is planning to offer a device based on Microsoft Corps Windows Mobile software. PalmOne has not commented on its future plans but has said it continually evaluates other operating systems.