Palm has been saved. Today, HP said it will buy the struggling handset maker for $US1.2 billion.

Shares in Palm (NAS: PALM), which is 30% owned by Elevation Partners – aka the venture cap fund backed by Bono out of U2 – surged 27% in after-hours trading as news of the deal broke (a pop that actually took Palm’s stock beyond HP’s buy price, which represented a 23% premium. Some investors are obviously expecting a higher offer. Or are just not too bright).