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Hewlett-Packard/Compaq merger to Proceed
Preparations for a merger between US computer giant Hewlett-Packard and PC maker Compaq will proceed despite the recent drop in their stock prices, their presidents said in an interview with the Financial Times published Monday.
"Only share owners can vote down this deal. The deal isn't going to come apart between now and then," said Carly Fiorina, president and chief executive of Hewlett-Packard, who would become CEO of the new HP if the deal is approved.
Hewlett-Packard president announced last Tuesday that the firm would acquire Texas-based Compaq for 25 billion dollars, creating a juggernaut to compete with IBM and Sun Microsystems in the corporate computing and server markets.
The new company also stands to become the world's largest maker of personal computers, ahead of Dell, and second only to IBM as a world computer services provider.
Fiorina said that the boards of both companies continued to support the merger, despite the drubbing that both stocks have taken following the merger announcement.
"We knew the market would be sceptical. I told both boards the market would hate this deal initially. We did not enter it unprepared. But to be honest it was a bit more negative initially than we thought," Fiorina said.
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