It's been a rough year for Palm. The company has been hit with staggering losses, it hasn't been able to move inventory, and executives have been bailing left and right. However, there appears to be light at the end of the tunnel.

HP just announced today that it plans to acquire Palm for $1.2 billion USD. Most in the tech community were practically begging for HTC to snap up the struggling smartphone maker, but in the end, it was HP that prevailed.

Palm shareholders stand to get $5.70 per share in the deal, which is a pretty nice premium considering that the stock closed at $4.65 on Tuesday.

"We're thrilled by HP's vote of confidence in Palm's technological leadership, which delivered Palm webOS and iconic products such as the Palm Pre. HP's longstanding culture of innovation, scale and global operating resources make it the perfect partner to rapidly accelerate the growth of webOS," said Palm Chairman and CEO Jon Rubinstein. "We look forward to working with HP to continue to deliver industry-leading mobile experiences to our customers and business partners."

"Palm's innovative operating system provides an ideal platform to expand HP's mobility strategy and create a unique HP experience spanning multiple mobile connected devices," continued Todd Bradley, executive vice president of HP's Personal Systems Group. "And, Palm possesses significant IP assets and has a highly skilled team. The smartphone market is large, profitable and rapidly growing, and companies that can provide an integrated device and experience command a higher share. Advances in mobility are offering significant opportunities, and HP intends to be a leader in this market."

For those that were wondering, Palm CEO Jon Rubinstein will be sticking around after the acquisition.

With Dell seemingly prepared for World War III with a slew of new Android and Windows Phone 7 phones on the way, it should be interesting to see what archrival HP will do with Palm's technology in the coming months and years.