Hewlett-Packard and Compaq Merger Opposed by California State Teachers' Retirement System
SACRAMENTO, Calif., Mar 14, 2002 (BUSINESS WIRE) -- The California State Teachers' Retirement System today announced it cast its vote to oppose the merger of Hewlett-Packard Company with the Compaq Computer Corporation.
"It is our responsibility to ensure the strongest possible investment portfolio for California's educators. Therefore, in carefully studying this issue, we listened to both sides in the contest. Both were very persuasive," said Jack Ehnes, CalSTRS chief executive officer. "However, on a portfolio-wide basis, as a long-term investor, we do not believe the transaction is in the best interest of the CalSTRS members and beneficiaries."
CalSTRS' concerns on the merger center on two main points.
-- The integration risk seems too great to be overcome on a transaction this large and complex.
-- The merger would dilute HP's position in its profitable printer and imaging unit.
CalSTRS, the nation's third largest pension fund, holds 3.3 million shares of HP and 5.3 million shares of Compaq in its $100 billion investment portfolio. |
