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

To: Night Writer who wrote (96381)	3/20/2002 11:00:18 AM
From: Night Writer	Read Replies (1) \| Respond to of 97611

Compaq shareholders set to vote on HP merger By Jeff Franks HOUSTON, March 20 (Reuters) - Shareholders of Compaq Computer Corp. <CPQ.N> were set to vote on Wednesday on a proposed merger with Hewlett-Packard Co. <HWP.N> in what was expected to be an easy win for the $20 billion deal endorsed by management of both firms. Unlike the pitched battle fought by HP shareholders, there was no organized opposition to the merger on the Compaq side, which led chief executive Michael Capellas to predict victory by a "very comfortable margin." "I'm absolutely confident that we'll be pushing forward," he told the CNBC business network. HP claimed a narrow victory in a tumultuous vote on Tuesday in Cupertino, California, but said it would take weeks to finish counting the ballots and post an official result. Merger opponent Walter Hewlett, who led an epic fight against the deal, said the race was too close to call. Hewlett, the son of one of HP's founders, opposed the merger on grounds it would hurt the company's strong printer division and saddle it with Compaq's low-margin personal computer business. HP chief executive Carly Fiorina said the combined companies would have more than $80 billion in revenues and sell everything from PCs to printers to large computer servers in a bid to compete with top computer firm International Business Machines Corp. <IBM.N> Compaq, once the largest maker of personal computers in the world, cut 9,500 jobs in 2001 and lost $785 million on revenues of $34 billion. It has been stung in recent years by top-level executive turnover, its own difficult $9.6 billion buyout of Digital Equipment Corp. in 1998 and intense competition from Texas rival Dell Computer Corp., which now sells more PCs than Compaq. HP, which announced job cuts of 6,000 last year, earned $408 million on revenues of $45 billion in fiscal 2001. HP's stock has fallen 19 percent since the deal was announced on Sept. 3, while Compaq dropped 10 percent. IBM shares rose 7 percent in the same period. The drop in HP stock has brought the value of the deal down from $25 billion when it was first announced. On Tuesday, HP stock closed at $18.80, up 45 cents, while Compaq shares rose 78 cents to $11.14. ((Houston newsroom, 1+713-210-8513)) REUTERS * end of story *