Handheld device maker Palm on the market

Smartphone manufacturer Palm has been put up for sale after its latest products, the Palm Pre and the Pixi, returned mediocre sales figures.

It is expected that the sale will attract the attention of technology companies of the likes of HP and Dell. Acquiring Palm could give them a fast route into the mobile sector, said Ovum analyst Tony Cripps.

It has been reported that Palm brought in bankers last week to assess the options for the business, to include a sale.

There was plenty of excitement surrounding the launch of the Palm Pre last year and was even considered to be a possible 'iPhone killer', however the disappointing sales did not reflect this initial hype.

Palm's webOS operating system has been praised for its usability and functionality, though Mr Cripps believes the strength of the Palm brand will prove to be its main selling point.

He said: "Palm's webOS has only been in the market for a short time and is somewhat unproven but there is a residue of fondness for Palm as a brand, especially in the US."

On the reports of a potential sale, Palm's shares increased by over 17%. Its stocks have fallen 69% over the past six months. It has been valued at £563m.

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