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Wednesday, 2 October, 2002, 09:31 GMT 10:31 UK
Palm fights Nasdaq exit
Handheld computer maker Palm has announced plans to restructure the way it prices its shares.

The changes aim to make sure the firm is not given the boot from the Nasdaq stock market, a possibility if shares continue to trade below $1.

The changes also come ahead of next year's separation of Palm's hardware and software businesses.

This separation is expected to push Palm's share price even lower than its current levels.

Reverse stock split

Palm's shareholders have approved a so-called reverse stock split, in which between 10 and 20 shares in the firm will be consolidated into one new share.

A one-for-10 split would see 10 Palm shares, worth $0.66 at Tuesday's closing price, consolidated into one new share worth $6.60.

The move would allow the firm to abide by the Nasdaq $1 rule without altering the value of investors' holdings in Palm.

Weak demand

Palm shares approached $100 in March 2000 when the firm was floated.

But the company's recent products have failed to spark much demand.

Sector watchers claim the products have not been glitzy enough to attract young cutomers, yet have proved insufficiently equipped to compete with more sophisticated handheld computers aimed at corporate customers.

See also:

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