So HP finally bought out the struggling Palm for a cool $1.2 billion. This valuation equals to $5.70 per share of Palm common stock and the deal is expected to be completed by the July end this year. Palm CEO Jon Rubinstein will continue to stick with the company even after the deal.

“Palm’s innovative operating system provides an ideal platform to expand HP’s mobility strategy and create a unique HP experience spanning multiple mobile connected devices. And, Palm possesses significant IP assets and has a highly skilled team. The smartphone market is large, profitable and rapidly growing, and companies that can provide an integrated device and experience command a higher share. Advances in mobility are offering significant opportunities, and HP intends to be a leader in this market.” said Todd Bradley, executive vice president, Personal Systems Group, HP.

“We’re thrilled by HP’s vote of confidence in Palm’s technological leadership, which delivered Palm webOS and iconic products such as the Palm Pre. HP’s longstanding culture of innovation, scale and global operating resources make it the perfect partner to rapidly accelerate the growth of webOS. We look forward to working with HP to continue to deliver industry-leading mobile experiences to our customers and business partners.”,  said Jon Rubinstein, chairman and chief executive officer, Palm.

Looks like this is gonna be one of those acquisitions where both parties come out smiling after the board meeting.