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Struggling Palm lays off 1,200

Treo smartphone maker restructures

Struggling handheld device maker Palm has been hit with layoffs.

The layoffs, which occurred yesterday, affected "a small percentage" of Palm's approximately 1,200 employees and were concentrated in the company's development group, according to a company spokesman. They primarily affect Palm employees in the US, he added.

Palm has seen steady decline in the handheld sector where it leads the market and is in the midst of financial restructuring. Last week, private equity investors Elevation Partners took a 25 percent stake in Palm, investing $325m into the struggling smartphone maker.

The company faces stiff competition in the growing smartphone market, where its Treo line has been a hit.

The Palm spokesman said that the reorganisation was in the works prior to the Elevation investment and that the company is still hiring staff in other areas. "We're flattening our organisational hierarchy and doing some realignment," he said.

He would not say exactly how many employees were being laid off.


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