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Technology Stocks : Compaq

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To: ELFRAM LYEW who wrote (19226)3/4/1998 12:07:00 PM
From: Jim Patterson  Read Replies (1) of 97611
 
The stock that CPQ will issue to pay DEC holders has no impact on CPQ. The deal cost CPQ $30 + the shares. The shares don't cost CPQ anything.

So any thought that this is some kind of ploy for CPQ so save $$ on the deal incorrect. The real threat is that if CPQ stock tanks, DEC could call off the deal or ask for a different mix of cash and shares in the interest of DEC shareholders.
With that in mind, CPQ does not want it's stock to go down. However, the comments from the CFO would indicate that there might be problems on the horizon, think of them as maybe a class action hedge. He hinted of a problem before he may or may not announce a real problem.

I hope that is clear.

Jim
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