From the Yahoo Board......
Compaq Sees Profit From
DEC This Year
Compaq sees profit from DEC this year
06:33 a.m. Oct 02, 1998 Eastern
FRANKFURT, Oct 2 (Reuters) - Compaq Computer
Corp said on Friday that the integration of Digital
Equipment Corp was on track and that its takeover of
the company would begin to contribute to earnings by
the end of 1998.
''At the time of the acquisition we said we were
determined to make Digital accretive by the end of the
year,'' Enrico Pesatori, Compaq's senior vice president
of marketing, told Reuters in an interview.
''We are executing pretty much to plan,'' he said. ''The
December quarter is when we really should start to see
the financial impact of the acquisition.''
As of October 1, Pesatori said, Compaq had a unified
North American sales force for products from Compaq,
Digital and Tandem, a mainframe maker the company
acquired in 1997.
It has also unified sales groups in some European
countries, but the process was taking longer in Germany
and France because of labour regulations in those
countries.
Compaq plans to reduce Digital's workforce in both
countries, but French and German laws require it to
negotiate layoff plans with unions and employee
representatives.
''In other countries the integration of finance and
accounting is already done. In Germany and France it
will take another six to nine months,'' he said.
Compaq has said the Digital units in France and
Germany are unprofitable and overstaffed.
Digital Germany last year had an operating loss of 65
million marks ($39.85 million) as sales fell 19 percent to
1.17 billion marks, Compaq Germany chief Gerrit Huy
told Reuters last week. Compaq wants to cut 820 of
2,500 jobs at Digital Germany, she said.
Pesatori declined to detail losses by Digital France or the
layoffs planned there.
Compaq has said it aimed to cut 17,000 job worldwide,
with 4,000 to 5,000 job cuts coming in Europe.
Including Digital, it now has a payroll of about 82,000.
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