3Com spins-off Palm business

NEWS 3Com is to spin-off its Palm Computing business, manufacturer of the best-selling Palm-branded PDAs. It is not clear how much Palm will be worth following an initial public offering (IPO), but for fiscal 1999 it brought in $570m (£354m), about 10 per cent of 3Com's annual sales. After the IPO early next year, 3Com will hold 80 per cent of the standalone business, but will gradually sell that stake too. 3Com said both its Palm division - which employs 600 to 700 staff - and its main networking operations would benefit from not being grouped together. Some industry watchers have blamed 3Com's lacklustre share price over the past two years on investors not understanding the nature of the company's business.