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Stock photo showing the HP Pre 3 front and back$1.2 billion. That’s how much HP paid for Palm last year, and it’s also how much the company was trying to sell its Palm assets for over the latter half of 2011, VentureBeat has learned.

As baffling as it may seem, HP was trying to rid itself of Palm without taking a loss on its purchase, a source with knowledge of the negotiations told us. When asked for confirmation about the pricing, an HP representative declined to comment.

The company seemingly ignored that Palm’s value had fallen significantly since HP purchased the smartphone pioneer in April 2010, thanks to the spectacular failure of the HP Touchpad tablet. And the fact that HP didn’t make any progress with its new webOS phones, the Pre 3 and Veer, didn’t help either.

It’s no wonder then that HP failed to find a suitor for Palm, after having discussions with Amazon, Samsung, Intel, and many others. HP eventually decided to open source webOS, allowing it to take advantage of the platform in the future without the need to allocate resources to keep it alive. HP CEO Meg Whitman said the company still plans to develop new webOS tablets in 2012.

It’s possible that HP eventually lowered its asking price for Palm, but it likely would have had to fall below $500 million for any company to consider snapping it up. We’ve also heard that HP was asking for continued access to webOS for use in its printers, something that would have only scared away potential suitors.

The $1.2 billion asking price shines some light on a story we heard from another source: At one point, HP’s team tried to pitch the sale to Facebook but was practically laughed out of the room. At first, I attributed that story to Facebook’s side being a bit obnoxious, but I can’t blame them if HP was indeed asking $1.2 billion. And yes, Facebook CEO Mark Zuckerberg was present at the meeting, although he apparently didn’t say much (I’m sure whatever he was thinking at the time would have been gold).

At this point, it seems that HP is either a terrible negotiator or never really wanted to let go of webOS in the first place.

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