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

To: Joe Antol who wrote (18298)	2/26/1998 11:12:00 PM
From: Luc Glinas	Read Replies (3) \| Respond to of 97611

If he's a slimball, why did the market react so promptly on his recommendation. Why not listening Merrill Lynch who keep his confidence on CPQ Why, Why, Why "slimball" have the favor of the market???

To: Joe Antol who wrote (18298)	2/26/1998 11:36:00 PM
From: Obewon	Read Replies (1) \| Respond to of 97611

Why does anyone think that CPQ will vigorously defend itself from current rumors? It is currently not in the company's best interest to do so. While it will take a stab at it to placate Digital shareholders, the company currently benefits from having a low share price when the deal is consumated (assuming another bidder doesn't step up to the plate). The deal is an acquisition of DEC by CPQ (not a merger of interests) so any premium that CPQ pays over DEC's fair market value (not necessarily the stock market capitalization) must be written down over a period of years. By letting the stock fall slightly, CPQ reduces the amount it is paying for DEC and thus reduces any subsequent write-offs. BTW: Has anyone here considered what DEC's inventory levels are and how they will affect CPQ's attempts to reduce inventory to two weeks (and analyst/Street's concerns about channel stuffing)? OB