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Technology Stocks : Compaq -- Ignore unavailable to you. Want to Upgrade?

To: Elwood P. Dowd who wrote (93631)	11/7/2001 9:46:36 PM
From: Satish C. Shah	Read Replies (2) \| Respond to of 97611

Hello El: Is the following true? "Specifically, one of the companies would be liable to pay the other if its shareholders were to fail to approve the deal, if its board were to change or withdraw approval of the deal, or if one of the two companies were to cause the deal to be delayed beyond May 30, 2002, or Aug. 30 under certain circumstances." If true, when does Compaq declare a special $0.40 break-up dividend, so I can take kids for ice cream? Regards, Satish

To: Elwood P. Dowd who wrote (93631)	11/7/2001 9:58:41 PM
From: Night Writer	Respond to of 97611

This article's headline could also read, A Battle between Tradition and Company Survival. Common sense makes me wonder if a printer franchise is really a big deal. It seems like making printers would be easier then making computers. If someone makes a printer technology break through, HWP could lose it's shorts real fast. Look at Xerox or Kodak. In the long run, HWP needs CPQ more then CPQ needs HWP and Hewlett is having a hard time accepting it. NW The "HP Way" and Fiorina's way may diverge By Peter Henderson SAN FRANCISCO, Nov 7 (Reuters) - Chief Executive Carly Fiorina was hired to shake up Hewlett-Packard Co. <HWP.N> but her ambitious acquisition plans have stirred the wrath of the families that founded the 62-year-old company and put Silicon Valley on the map. That fight over Hewlett-Packard's plan to buy Compaq Computer Corp. <CPQ.N> pits the heirs of two legends in the technology industry against an executive who has been hailed as the most powerful woman in American business. Fiorina will either carry through the largest computer merger in history or lose her job trying, analysts said. Fiorina has grappled for two years to recast a family-style management legacy, the "HP Way" credited with inspiring intense loyalty at the company, which was founded in a garage as one of the first Silicon Valley start-ups. Fiorina's picture smiles in HP lobbies along with those of founders Bill Hewlett and Dave Packard, but HP's new slogan -- "reinvent" -- is decidedly hers. "I think the company's success will be my legacy," she told Reuters in October. "The company's failure will be my failure, with all the predictable consequences," she said, at a time when investors opposing the Compaq deal seemed to be resigned to its inevitability. On Tuesday, however, the dissent gathered momentum as the Hewlett family, which has a stake in the company of more than 5 percent, and the David Woodley Packard, son of the late founder, David Packard, signalled that they would vote against the merger, which both companies' boards support. In Los Angeles on Wednesday, Fiorina declined to take questions from waiting reporters. Her only indirect comment on the controversy was couched in a general remark to a civic group on what it takes to be CEO: "Doing that job always requires the courage of one's convictions." CUTS SAID COUNTER TO TRADITION OF JOB SECURITY Packard said he disagreed with the way the company was being run and questioned planned job cuts which run against HP's celebrated tradition of job security that goes back to the founders. "Bill and Dave never developed a premeditated business strategy that treated HP employees as expendable," Packard said in a statement voicing his opposition to the merger. "For some time I have been skeptical about management's confidence that it can aggressively 'reinvent' HP culture overnight -- a culture that developed over many years and was thoroughly tested under all kinds of business conditions." HP has laid off roughly 7,000 this year and plans to improve profits by cutting 15,000 more jobs after acquiring Compaq in what management says will build a company with enough market power in technology services and high-end computing to take on International Business Machines Corp. <IBM.N>. Walter Hewlett, the son of co-founder William, has also opposed the deal on the grounds it would focus on personal computers and dilute the value of the company's lucrative printer franchise. He said he was opposed to the deal, not Fiorina. But Deutsche Bank's George Elling, one of the few Wall Street analysts who has openly supported the merger, said the Hewletts were also concerned with broader issues. "Management indicated to us that Hewlett's decision was primarily an 'emotional' one, relative to the radical changes that the company was undergoing," Elling wrote in a research note. Lehman's Dan Niles said the founding families stakes also had an economic reason to oppose the deal, which has pulled the value of their holdings sharply lower. "That's an easy catalyst: the stock went from $23 to $16 and they own hundreds of millions of shares," he said. The biggest family-controlled stakeholder is uncommitted. The David and Lucile Packard Foundation, with 10.3 percent of HP stock, said it is hiring a consultant for advice. The Hewletts hold about 5 percent of shares and David Packard less than 2 percent. The Foundation holds the trump card and will likely determine the fate of the deal and Fiorina's, Niles said. "It is pretty simple. The deal gets voted down, and she's gone. The deal doesn't, she'll stay there." ((Peter Henderson, San Francisco Bureau 415 677-2578 peter.henderson@reuters.com)) REUTERS

To: Elwood P. Dowd who wrote (93631)	11/7/2001 10:30:32 PM
From: Night Writer	Read Replies (1) \| Respond to of 97611

El, Wait until the wind blows the other way next month. The arbs will start slowly building positions again while publicly stating they are not playing the merger. Remember all the articles quoting arbs? The arbs said they would not play the merger because it was too high a risk. The arbs said one thing and did the other. Keep the spread as big as possible. I have to say one thing. Hewlett sure flushed the vipers out into the open.<G> Diabolical thinking. I wonder if the Hewlett institute unloaded a few shares to the Arbs. Maybe the Packard folks decide to vote their 10% for the merger. Then the Hewletts can buy the shares back cheaper when the Arbs start shorting again. Hmmm, with consultants on both sides, they could do it. Are the kids playing the arbs? NW