CNBC is reporting that a major Palm shareholder, who did not want to be identified or his stake disclosed, is expecting Motorola to acquire Palm for about $2 billion.

“They (Palm) generate a lot of cash,” the shareholder added. “Paying $2 billion in cash for a company generating $120 million in free cash flow is not a stretch. They could pay up to $25 a share and the deal would still be accretive. Accretive immediately.”

We heard a couple of days ago that Palm might be ready to sell. It was believed, however that Nokia, not Motorola had the inside track.