HP is Buying Palm for $1.2 Billion. Update: CNBC’s Breaking Report [Video]

For weeks, the tech media has wondered who was going to buy Palm, Inc., the pioneering smartphone manufacturer that has since fallen on harder times. Now, we’ve got an answer, and a price: The buyer will be HP, which has reached a “definitive agreement” to buy Palm for $1.2 billion.

This knocks out recent rumors that RIM or HTC would buy Palm, although an HP acquisition is a thought that has crossed some people’s minds before.

Update: CNBC‘s breaking report on the acquisition:

From HP’s press release:

HP and Palm, Inc. (NASDAQ: PALM) today announced that they have entered into a definitive agreement under which HP will purchase Palm, a provider of smartphones powered by the Palm webOS mobile operating system, at a price of $5.70 per share of Palm common stock in cash or an enterprise value of approximately $1.2 billion. The transaction has been approved by the HP and Palm boards of directors.

The combination of HP’s global scale and financial strength with Palm’s unparalleled webOS platform will enhance HP’s ability to participate more aggressively in the fast-growing, highly profitable smartphone and connected mobile device markets. Palm’s unique webOS will allow HP to take advantage of features such as true multitasking and always up-to-date information sharing across applications.