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

To: Lynn who wrote (96306)	3/19/2002 1:46:04 PM
From: PCSS	Read Replies (1) \| Respond to of 97611

Today's G/L Spread NOW .30 --- and CLOSING QUICKLY CPQ in the ++ column now

To: Lynn who wrote (96306)	3/19/2002 1:46:30 PM
From: Lynn	Respond to of 97611

Emotional split at H-P meeting Anti-merger crowd cheers Walter Hewlett By Mike Tarsala, CBS.MarketWatch.com Last Update: 1:42 PM ET March 19, 2002 CUPERTINO, Calif. (CBS.MW) -- Hewlett-Packard shareholders greeted CEO Carly Fiorina with tough questions -- and loud boos at one point -- while giving dissident director Walter Hewlett a huge ovation Tuesday as they voted on the largest proposed technology merger ever. Free! Sign up here to receive the Real Estate Weekly e-newsletter! Create an alert for Add to my portfolio Discuss NEWS FOR More news for Quote & NewsChartsFinancialsAnalystsOptionsSEC Filings Quote delayed 20 minutes. Disclaimer "For many decades," Hewlett told the shareholders, "H-P has presented a unique vision of the best an American corporation can be ... the very public, very spirited debate has also been about the soul of H-P and what it means to America." Hewlett's address at the spirited special meeting, which was delayed 30 minutes to allow the throngs of shareholders to arrive, was followed by a question-and-answer session with Fiorina. Shareholders were allowed to cast ballots during the meeting. The polls and the meeting closed at about 1:15 p.m. ET. In her session, Fiorina faced tough questions from employees concerned about layoffs and from shareholders who questioned the value of the deal and the chances of successfully integrating the two companies. It was clear that many who had chosen to attend the meeting were vocal opponents of the merger. A few wore green clothes to show support for the green proxy cards being filed by those voting against the merger. The 2,000 to 3,000 people at the meeting represented less than one percent of the company's more than 900,000 shareholders. At one point, responding to a shareholder's question about whether a lack of employee support would make a merger more difficult, Fiorina said, "The majority of employees understand and respond to this merger." The audience booed, and she responded: "Ladies and gentlemen, we know this for a fact" based on surveys H-P has done of its employees. One man, who said he had been with the company for 22 years and worked his way up through the ranks, then stood up to say he chose to work for H-P even though he could have made more money during the Silicon Valley boom because he had made a longterm commitment to the company. He said he would leave the company if the merger went through. She said there are now more than 900 people working on the integration of the two companies and said she was aware of the different cultures. She described Compaq as having an "e-mail" culture and H-P as having a "voicemail" one and said they were working to merge them. She added that H-P employees tend to look to the past for guidance while Compaq's look forward. "High tech companies by nature must focus on their future while celebrating their past," she said. One shareholder, an Ohio man who owns 200 shares and said he had been attending stockholder meetings for 35 years, asked Fiorina to ensure that Walter Hewlett would be nominated for re-election to the board of directors. She said that decision would not be up to her. A pro-merger shareholder rose later in the meeting to say that Walter Hewlett had betrayed his late father by not joining the rest of the board of directors in support of the merger. He was also booed. Eleventh-hour boost The case for the merger got a last minute boost when Capital Research, which holds 3.4 percent of H-P shares and is its largest institutional shareholder, was reported to be voting 65 million of its 69 million shares in favor of the merger. But Wall Street on Tuesday was leaning toward the deal not being approved. The spread between what H-P intends to pay for Compaq and the actual value of its shares widened to 18.3 percent from 14.9 percent Monday, and 9.4 percent on Friday. Compaq (CPQ: news, chart, profile) shares were down 13 cents at $10.23 on the New York Stock Exchange, while H-P (HWP: news, chart, profile) shares were up 58 cents at $19.83 in morning trading. Hewlett insisted that the debate over the proposed merger had been healthy for the company. "The H-P Way is alive in employees, stockholders and in our communities," he said. "H-P is not a company in crisis. H-P has a promising future." With the $20.7 billion deal hanging in the balance after a media blitz by opposing sides, it's likely the votes will take several days to tabulate, though either side could claim victory as soon as Tuesday morning. The vote will be tabulated by hand. See full story. Heading into the final vote, the merger tally remains too close to call. Two more shareholders came out against the deal on Monday. The Teacher Retirement System of Texas, with 5.87 million shares, or a 0.3-percent stake in H-P, said it would vote against the merger. Wachovia Corp., which claims it has about a 0.1-percent stake, also said it planned to issue a "nay" vote. Public dissenters now represent about 25 percent of H-P's total shareholder base, while public supporters of the deal make up about 12 percent of the company's total 1.94 billion shareholders, including Capital Research. The votes still don't provide enough information to accurately gauge the proxy contest, however. Mike Tarsala is a San Francisco-based reporter for CBS.MarketWatch.com. marketwatch.com