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

To: hlpinout who wrote (94161)	12/11/2001 9:58:41 PM
From: Captain Jack	Respond to of 97611

Whoops-- this is 'redundant' too,, but gives some employee insight so who gives a damn... SAN FRANCISCO, Dec 11 (Reuters) - The chief executives of Compaq Computer Corp. <CPQ.N> and Hewlett-Packard Co. <HWP.N>, facing widespread dissent to their plan to merge the firms, lobbied employees and urged them to stay focused in a pair of memos released on Tuesday. Both companies have gone to great lengths to cultivate internal support for the deal but risk distracting employees, which is seen as the main threat to the deal by both management and critics. Compaq's chief, Michael Capellas, caused some to question his dedication to the merger when he said Compaq could thrive with or without HP. "Everyone of you can help -- by staying positive about the merger, educating yourself about its benefits and by delivering strong first quarter results," wrote HP Chief Fiorina, who is seen as the driving force in the deal. The two chiefs have held staff meetings, polled employees, and kept up a steady stream of postings on internal Web sites, including recent advice on how-to conduct a successful merger from a famed author of self-help books. The feature article on HP's internal Web site, a copy of which was filed with securities regulators, said that while 70 percent of mergers fail, HP and Compaq could be among the successful minority. "You need to remain focused on the marketplace, on the superior value you're delivering to customers as a result of the merger," Stephen Covey, the author of "The Seven Habits of Highly Effective People," was quoted as saying. HP says its lobbying works, according to internal polls. "The more time Carly and senior leaders spend educating the employee population about the merger, the more enthusiastic they become, and the data backs that up," said spokeswoman Rebeca Robboy. She said HP had not completed a new staff poll since Friday, when the company's biggest shareholder, the David and Lucile Packard Foundation, said it would oppose the deal, uniting the founding Hewlett and Packard families against it. HP in past weeks has posted lists of answers to frequently asked questions, comments on Compaq's culture -- which an HP executive said was "candid," "results-oriented" and an "amalgamation of people from many different backgrounds and companies" and criticized "shallow reporting" on the deal and Wall Street analysts' focus on the short term. Compaq has also made internal communications a priority, although Capellas' note released on Tuesday in support of the merger was treated as a warning by some employees. Capellas, like Fiorina, praised the merger, his company's strategy and told employees to focus on business at hand. "But regardless of the circumstances - whether we are part of the new HP or a stand-alone company - I am confident in our ability to achieve these objectives," he said. One employee who declined to be named said the change in tone signaled a new ball game. "We accepted it was going through but then suddenly we saw that e-mail the other day," the employee said. "That (memo from Capellas) was basically saying 'I don't think it's going to happen and we might have to survive on our own' ... that's what it said to us." Capellas later told reporters that he "absolutely" still backs the merger. He added in the internal memo, "The best thing we can do right now is to maintain our positive momentum in the market." ((Peter Henderson, San Francisco Bureau 415 677-2578 peter.henderson@reuters.com))