Elevation Partners to eke out a $25 million profit after sale of Palm | webOS Nation

Elevation Partners to eke out a $25 million profit after sale of Palm

by Derek Kessler Wed, 28 Apr 2010 10:53 pm EDT

Elevation Partners

While we won’t expect Elevation Partners to say anything about it until the sale is complete, it looks like they’re about to walk away from Palm with a small profit. This flies in the face of sensationalist claims of partner Bono (yes, of U2 fame) being “the world’s worst investor,” though we imagine he, Roger McNamee, and the rest of Elevation Partners had hoped to make a bit more off the deal. Just how much is Elevation set to get when all is said and done? $485 million, according to Venture Beat.

That amounts to 40% of the $1.2 billion that HP is set to lay down to snap up Palm. The story of how Elevation’s getting more than their 30% share of Palm is an interesting one. Elevation’s initial investment in Palm in 2007 was to the tune of $325 million, which wrapped up 25% of the smartphone maker under Elevation’s control. Elevation has twice in the intervening years invested in Palm stock, upping their total investment to $460 million.

So luckily for Elevation Partners and all their investors, they didn’t lose money on this deal. Of course, if they’d sold their shares late last year when Palm stock was trading over $18, they could have brought in close to $1.5 billion. Yes, you’re reading that right, a third of Palm used to be worth more than what HP is paying today. That’s what happens when expectations are tempered by reality.