Can Palm Still Snag a Suitor?

"That country girl has witched your wishes,
all dressed up in her country clothes
and she hasn't got the sense
to hitch her rags above her ankles."
-- "To Andromeda," by Sappho, circa 600 B.C.

That ancient country girl lives on in Palm (Nasdaq: PALM). The smartphone veteran is looking for a mate now, but she hasn't got the sense to show off her assets.

Bloomberg reports that Palm has brought in advisers from Goldman Sachs (NYSE: GS) and superbanker Frank Quattrone's Qatalyst Partners to scrounge up a buyer. Palm CEO Jon Rubinstein routinely dodges buyout questions, but this time, the end of Palm's solitary road may be for real.

The company has been bought before, of course. Back when the finest Palm device was a PDA without wireless-phone components, the company was a part of  US Robotics, which later got snapped up by 3com, which is now a division of Hewlett-Packard (NYSE: HPQ). Phew!

HP is a long-rumored Palm buyer, but Bloomberg points toward Taiwanese smartphone wrangler HTC and Chinese computer giant Lenovo as the more likely bidders. Dell (Nasdaq: DELL) is out of the question, according to Bloomberg's anonymous sources.

Now, what about that country girl? CEO Rubinstein, of former Apple (Nasdaq: AAPL) iPod fame, has one powerful asset at his disposal, but he's not too fond of using it. When interviewed, Jon likes to talk about the multitasking features of his WebOS software, or the way it can present information from multiple sources in a unified interface, or some other easily duplicated software feature.

But the real value of Palm has less to do with the WebOS platform or Pre hardware -- it's all in the brand name, stupid.

Don't expect anybody with a bankable American name of its own to buy Palm. HP and Dell would be better off licensing someone else's software, and maybe outsourcing the hardware side of the equation. That's pretty much what Dell is doing already. Research In Motion (Nasdaq: RIMM) and Apple have no reason to show any interest at a price that would be palatable to Palm’s private-equity masters.

HTC or Lenovo could certainly use a marketable brand like Palm to gain credibility in North America, but only at bargain-basement prices. And if they do buy Palm, the WebOS experience could swiftly vanish into irrelevance. Google's (Nasdaq: GOOG) rival Android platform is already working out just fine for HTC, for example.

Private equity firm Elevation Partners holds a 30% stake in Palm, and it would love to keep a few pennies of the big, bad dollar it invested. That's why some kind of deal is likely to happen, even at ridiculously low prices.

But Palm needs to rethink how it presents itself to the world, lest Elevation and other shareholders get stuck with a pittance of a dowry. Palm isn't quite worthless, but it's not far from it, either.