No Bonus For Bono

U2’s global record sales and tours have netted the band a fortune but Bono might lose quite a chunk of money if computer giant Hewlett-Packard buys mobile phone producer Palm for $1.2 billion as was announced April 28.

Elevation Partners, Bono’s private equity venture, owns about 30 percent of Palm.

In 2007 and 2008 it invested $460 million in the struggling handset maker, which was preparing to launch the Palm Pre smartphone to challenge Apple’s iPhone in the mobile market.

The HP deal values Palm’s equity at $961 million after debt, meaning Elevation’s stake will be worth about $320 million – a downside of about $140 million.

The offer values each share at $5.70, a 23 percent premium on the listed price, but considerably less than the $18.09 it reached last year when the Palm Pre hit the market.

Last month, financial blog 24/7 Wall Street named Bono as the worst investor in the U.S., citing “an unprecedented string of disastrous investments which even bad luck could not explain.”

Elevation Partners specialises in investments in media, entertainment and technology. It invested $300 million into Forbes in 2006, although Henry Blodget’s Business Insider blog recently estimated the magazine group to be worth $100 million.

In 2005 Elevation took a 15 percent stake in Move.com for $100 million, although the company’s share price has since dropped by roughly 50 percent.