Palm shareholders will vote on the company's proposals to spin-off its PalmSource software unit and to acquire Handspring on October 28.
The company has already announced its plans to acquire Handspring, which will become part of its future hardware division, and to spin-off its operating systems arm, PalmSource, as a separate division.
The Handspring acquisition will cost Palm $168.9 million in stock.
Palm is telling shareholders: "Palm and PalmSource believe that Palm's stockholders will realize benefits from the separation of the two companies."
These benefits include: "Greater clarity of mission and focus for both businesses", "faster response to technology change and customer needs," and more licensors for the Palm OS.
Palm management believes the Handspring merger will broaden its hardware arms product portfolio, and offers to broaden the both company's distribution and telecommunications carrier relationships.
Shareholders as of September 23 and before will be able to vote on the plan.