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HP/Compaq Merger Apparently Approved
Spinality writes "Looks like HP's hotly contested merger with Compaq is going ahead. Various news headlines such as this one at Bloomberg.com report that stockholders voted to merge, against the wishes of the Hewlett and Packard families. " There isn't official word yet, but this looks like
it's pretty much a done deal. Anyone else think the business world looks like a
game of Pac Man?
before they've hatched. The official tally may take as long as six weeks to be completed, and until then this is just speculation. It's still too close to call. All of these media reports remind me of, ahem, Florida.
Sig (appended to the end of comments you post, 120 chars)
Check it.
The register, in their usual style, compared the voting process to a zimbabwean national election....
When I finally see an announcement that it's happened and start seeing some Hewlett PackPaq(tm) boxes on the shelves, then we can start talking.
Randal Graves says: I'm a firm believer in the philosophy of a ruling class... Especially since I rule.
With the current state of the (US) economy, it's a very smart move for hp & compaq to merge. in the end, i think the hp families will see that this was in the best interests of the company, since their combined market share will ultimately increase the market value after the merger.
I've had a lot of problems installing H-P devices. H-P has become a sloppy company, in my opinion.
I don't think Carly Fiorina is better than Lew Platt, the former CEO. It has been a long time since H-P has had a real leader.
Bush's education improvements were
Which is different from an actual tally.
Is she taking a cue from the last Pres. election and getting on the news with a fait accompli in the hopes of discouraging the last remaining mail-in proxy voters? Yes, AG did it backwards and conceded prematurely, but the media had no problem projecting before the polls closed. Lesson learned by Carly?
"As God is my witness, I thought turkeys could fly." A. Carlson
I find it disheartening that it's impossible to maintain a business with integrity and vision in the face of greed. The Hewlett family are not exactly soft, left-wing hippies; they just wanted to protect the strength of their brand.
Prepare to see the quality of HP products plummet. Prepare to see a slow death of niche imaging products.
Prepare to see layoffs of otherwise securely employed folks. Rah rah, share value.
Their network printers were so nice...
Interesting watching the share prices of HP (NYSE:HWP) and Compaq (NYSE:CPQ) - makes it clear what the markets/analysts think of this!
The time of mega mergers is here. Who cares if hundreds, nay thousands loose their jobs. Instead of innovation and growth, the companies are taking the easy way out. This works in the short run, but the economics will catch up. They can run away from slowdown only for some time, evenetually it will catch up. Luckily the economy's improving, otherwise it would have been a disaster. Such mergers are bad for consumers too. As long as they were competiters, consumers could get good products as both were trying to do one up. For example is Dell also merges with them tommorow, the competition space will get monopolized. It seems the hardware world is also going the software way. Like M$ monoplizes everything these big daddys gona eat up competition, what will we have them, open design hardware!?
My Aurora : http://www.youtube.com/watch?v=o91ZsGwJYyg
FB : https://www.facebook.com/TanveersPhotography
Anyway, here's what HP has on their own site. Looks like most bridges have been burned in this one and if it doesn't actually go through HP's going to look like a pretty sorry mess. Too bad the combatants in this one didn't keep the vitriol out of the press, i.e. one page ads in the SJ Merc, or the 'dillitante' remarks.
IBM must be aware that even if it does go through, it's a house divided, which will take some time to come together, if ever.
A feeling of having made the same mistake before: Deja Foobar
quick question...who else is now big in the world of retail computers...meaning like, you walk into a Best Buy or a Sears, whose computers are you gonna see??? this doesn't matter to me, cause i would personally never buy a computer from a store like that....but i'm just curious, becuase it seems like Compaq and HP were always the majority of the retail desktops out there...who is left to compete? or are they gonna have a virtual monopoly in that field???
"Facts are meaningless. You could use facts to prove anything that's even remotely true." - Homer Simpson
This merger did not make sense for HP. Why would a company that is trying to get out of the desktop computer business buy another company that has a large desktop manufacturing facility. I agree with the Hewlett family for blocking this merger. Just because the merger might be approved by the voters by the narrowest of margins does not mean this is good for HP. HP is paying too much for bigger stake in the low margin pc market. What happened to HP's focus of delivering services?
Remembers me of another election and something about Florida... ;op
Anyway, if I was still working for HP I would be rather pissed off at Fiorina taking some fat cash from the merger while 15000 employees are going to get the boot (and countless more were laid off by her policy). Especially since she is the one who would have got the boot if it wasn't for the merger!
Black holes occur when God divides by zero.
What I'd love to see if this merger goes through is the HP midlevel servers phased out and the Compaq ones come more into play. The Proliant series of rack-mount servers are stable and is rock steady, cheaper, and offers more options then a comparable HP. Then, merge TopTools into Compaq Insight manager, add some tweaks for NNM and OVO as well as a few other HP software tools and bundle it all together. They couldnt lose. You'd have arguably the best x86 server hardware with the best software management tools from one company.
Have you taken a look at Compaq hardware lately? Nothing compares to it serverwise, 2U servers with redundant PSU's, redundant fans and even redundant memory boards, HP cant come close.
Looking for hardware (Currently need: Large Etch-a-Sketch) Have one? See my journal!
``A decisive majority'' of shares not affiliated with the Hewlett and Packard families voted yes, Fiorina said.
It's going to take more than just a majority of non-hewlett shares to swing this one. The Hewlett family's shares account for 18% of the company. It's going to take *61%* of the remaining 82% to make a majority of the total shares.
May I recommend Kim Stanley Robinsons Red/Blue/Green Mars Trilogy. Unfortunatley I can't find any links relating to the corporate intrigue found in these novel's and the picture the author paints of earth's near future but maybe you'll have more luck if you haven't read the books!
Never underestimate the dark side of the Source
Don't care if Carly is running HP into the ground but respect her Linux friendlyness?
Allow me to weild the clue-stick here. If HP disappears because Ms. Fiorina wants to measure dicks with Mr. Palmisano of IBM, she might as well be giving weekly handjobs to Mr. Torvalds for all the good it will do Linux.
In fact, if HP does get involved with Linux heavily and then goes down to mismanagement, they'll become just more fodder for the MS FUD machine: another Linux comany bites the dust.
"As God is my witness, I thought turkeys could fly." A. Carlson
I own a small amount of HP stock and the proxy mailings for this vote were obscene. I received at least eight proxys - half from HP and half from the Packard family group. Only proxys by mail were accepted - online and telephone options were not available. The most recent proxy mailed in was the one that actually counted. All designed for maximum confusion. Messiest merger vote I've seen in a while.
Have you ever seen a "what's good for Pac Man is good for the game" cheat?
In 1998, or 99, Compaq bought out DEC in order to get the rights to the Alpha chip, and then didn't know what to do with it once they owned it. The already dwindeling VMS operating system became less popular as a result. Compaq directors needed to get out from under a badly handled situation, so they found a sucker.
HP finds its printer division doing very well and its computer devision growing too slowly, so they take the money from one and sink it into Compaq. It could work out well for HP, if and only if, they use the Alpha technology to their advantage. The desktop devision sucks anyway, and should not be considered as HP's salvation.
Tune in next week when . . .
The whole HP-Compaq merger thing is a typical example of how high-level executives who understand "business" think:
- They have to "do something" to justify their compensation.
- They don't understand the technology, so they don't have a clue as to how to make use of the innovations their employees generate (Xerox comes to mind immediately, but they're just the most obvious example).
- They do understand high-level finance, and how to fire people to create short-term gains.
So, they do what they understand - move big pieces around on the board, construct complex financial objects that obscure the connection between their actions and company performance, and fire people whose functions are superficially redundant.
To a Lisp hacker, XML is S-expressions in drag.
This could cause serious fragmentation of the Beowulf clustering market.
For a long time HP have been pushing their Wolverine Extensions (much to the dismay of clustering gurus). With the might of Compaq behind them they'll have the impetus to succeed.
Although, on the bright side, it brings Windows into the Beowolf fold.
Guess we'll have to learn that API now!
I have a pitiful few shares of HP stock from my time there, and over the past few months, I've received an absolute torrent of competing proxy solicitations from the HP board and Walter Hewlett. Every week, I got at least one new proxy card from each party with a "send this in Right Now" letter. This stuff arrived faster than one could conceivably respond (and even though I'd promptly returned the first green proxy card I got...) Towards the end, the HP board even priority-mailed me a prepaid Fedex envelope with another proxy card, and shortly thereafter a premetered ($3.50) priority-mail envelope. Last, and IMHO rather underhandedly, the board set up a phone-in-and-vote-your-proxy process during the last three or so days, something they would NEVER have let their opposition get away with. UN election monitors would NOT approve...
Also worthy of note is the tone of the cover letters: the Walter Hewlett "anti" camp focused on the bad business sense of the merger, but the Board quickly started a series of personal attacks on Walter Hewlett. This did NOT impress me with their confidence in their case: when you run out of logical arguments, slander your opponent's person.
It ain't over 'till the fat lady sings, and there is NO reliable way to guess who'll still be standing to deliver that final aria. The tons (literally!) of proxy cards sent in to the warring factions' accountants must be sorted and matched by sig and date to weed out proxies revoked by subsequently-sent proxies (and since so MANY cards were sent out, there'll be hundreds if not thousands of revotes); this will certainly take a week. Also consider (shock horror!) the possibility that the electronic or telephonic proxy-submission processes might have been manipulated. Carly's no Ken Lay, and it sure ain't the HP Way, but there's a LOT riding on this (several top management jobs, for example), so the possibility of skulduggery is NOT to be ignored.
"My strength is as the strength of ten men, for I am wired to the eyeballs on espresso."
to quote an old line from Saturday Night Live...
"My strength is as the strength of ten men, for I am wired to the eyeballs on espresso."
HP laser printers with PostScript are first-rate. HP computers and their non-PostScript inkjet and multifunction line are what will spell doom for this company. The merger will only add more weight to their sinking business model.
Why merge with another computer company that does the same thing HP does in terms of PC design? HP and Compaq workstations are among the most proprietary PC designs around, making tech support a nightmare (I've handled both and still have shakes when I think of it).
HP has also stiffed me personally with crappy hardware--the OfficeJet multifunction printers have abysmal drivers that causes my computer to hang routinely, and the firmware of the printer is very faulty and wastes my time by giving off false hardware errors.
If HP thinks that a simple merger will help them, they are wrong. HP needs to concentrate on what they do best--and computers aren't it. How about an inexpensive PostScript printer that doesn't require an engineering degree to print one damned page?
I find Carly's determination admirable, but her goals are very suspect. HP is going the wrong way, and its too obvious.
Vos teneo officium eram periculosus ut vos recipero is.
In addition to the Compaq merger, HP also plans to merge with Intel and UPS.
No comment was give to queries if the resulting company would be called Hic-UPS.
Have you read the moderator guidelines? Well, have you, PUNK? (and I want a Karma: Gnarly option)
Hewlett-Packard Company Chairman and CEO Carly Fiorina discussess the current course and what's ahead for Linux in enterprise and consumer applications. Ms. Fiorina highlights innovative solutions that customers are implementing today and talk about the contributions and responsibilities of the Linux and open source communities in increasing customer value for Linux users.
The end of Ms. Fiorina keynote speech is worth repeating here...
demand for linux
The company that brought us the green ogre with the thick Scottish accent and wicked sense of humor wants Linux. Companies that provide the dial tones when we pick up the phone want Linux. And in between the two are thousands and thousands more who are recognizing the power, the flexibility and the smart economics inherent in this platform - and who are attracted to its openness and the inventive spirit that is at its foundation.
We cannot disappoint customers who are clamoring for Linux solutions. Standing still is not, and will not, be our legacy - with Linux, or with any other invention that has the potential to transform this industry, as we certainly believe Linux does.
Which brings me to what I see as the real power of the Linux movement.
The secret to its success is based on a belief in what hundreds of thousands of inventors can do together when you make full use of their talents. And here again, just like all the other great inventions that came before it, like all other great steps forward, the skeptics out there said: It won't work. It won't sell. It can't be done. It won't succeed.
Your collective response: Never underestimate the power of a good idea.
Anyone else think the business world looks like a game of Pac Man?
It's pure math, really. There is a significant, steady stream of new businesses being created, even if you only count the ones that make it past the infancy stage. Additional ones are being created buy spin-offs/spin-outs/demergers/whateveryoucallits.
In a country with a relatively stable population, this can only mean one of two things: Either the average size of firms must be decreasing, or a number of firms must be disappearing. The strongest of these two factors will of course be the latter. Given that the two ways in which companies can disappear are bankruptcies/liquidations and mergers, you could say that mergers are good. Even if a merger is followed by layoffs etc., a company remains to pay severance packages and face other liabilities. Furthermore, a merger is usually less wasteful than closing a company, as valuable assets such as brand names are more likely to be preserved.
In a dynamic world with quick changes in technologies and customer preferences, continuous restructuring is necessary and desirable. Mergers are important mechanisms of such restructuring, alongside entrepreneurship, bankruptcy, strategic alliances etc.
Now, I have to admit, I'm biased, since I work for one of the little guys, but I wouldn't work for 'em if I didn't feel strongly about it.
Say what you will about the mom and pop shops, but I've seen customer after customer come to us utterly frustrated by their experience with a name-brand pre-built. Seriously, the next computer you get, don't just waddle down to Best Buy or Sears, check out the small shops.
In my opinion, you get better value, better support, and a better warranty from the smaller companies than you do from the big ones.
Anyway, just my 2 bits.
I have friend who used to work at HP and still owns stock. Two things he says:
1. a. He is not for the merger
b. Does not have a single friend who is for the merger
c. Does not have a single friend who knows
of another co-worker who is for the merger
2. a. He does not like Carly
b. See 1b
c. See 1c
Too bad to see a company run by engineers now being led by a history major(i think).
For what it's worth.
The reasons that this merger is just fine with the government are pretty simple. There's a measure for each industry called the Herfindahl-Hirschman Index. If a merger doesn't make this number go over a certian boundary, it's all good. HP and Compaq are in an industry that is diversified enough to handle a horizontal merger like this one.
How long before they're all suing M$ for evil monopolistic armtwisting?
Given recent corporate events, I would think they'd just merge with M$.
I pledge allegiance to the flag...
of the Corporate States of America...
My grampa kicks your grampas ass.
We got him and grandma a nice little compaq to surf the internet with. Inside of a year not only was he installing peripherals, and software, but adding ram on his own. Sure I get like a call a month, and sure I get all kinds of "interesting web site" clippings from their local paper sent to me. But it's really satisfiying to see...err hear them getting so much enjoyment out of it. I didn't think they'd do a tenth of the stuff they've done with it.
That will certainly teach me to underestimate MY grandparents, perhaps yours have a similar lesson in store for you.
--Jimmy has fancy plans; and pants to match.
I agree with Carly that HP is in need of major repair - the HP way, though laudable, represents a bygone era that simply can't be applied to modern business. That said, combining HP with another model of mediocrity, Compaq, in a hope to eek out savings-through-scale in the cut-throat, low-margin hardware business is simply not going to increase value.
These companies will spend at least two years properly integrating, during which time Dell and IBM will continue to lead, and in fact increase their leads in hardware and services. After the dust has settled on the two year merger process, the new HP will simply make its quarterly numbers by cutting staff and relying on long-term contracts in its traditional businesses....like 90% of the other mergers of the recent past.
Okay, I liked your remark about Apple, so I couldn't resist replying.
Apple has an odd market niche. There are actually plenty of more expensive PCs, you just don't see them in mainstream stores. To get something as powerful as the $2,999 2x1ghz PowerMac for the audio/video applications that are its primary market niche, you'd have to buy a $3,500-4,500 PC. You just don't see many of those in store shelves, so Apple looks expensive.
If you want a LCD monitor, the iMac is amazingly competitive, especially when the low-end models finally show up.
Of course as long as you have a Mac already, I don't see her as having tastes any more expensive than PCs. All the software prices I've seen are the same on both platforms.
D
"Go out and score an athlon motherboard, Fat Freddy - and don't get burned again this time!"
I bet they've got Emachine's quaking in their boots! (and smoking out their power supply's...)
I guess there's always room for America's Choice Computers (available at your local safeway supermarket)
In the future, I would want to not be isolated from my friends in the Space Station.
What I've noticed is that every time companies merge, service gets worse, people get laid off and products plunge in quality.
I don't understand this weird business romance thing. It's almost impossible to glue together two very different corporations, especially if they are billed as a "merger of equals" where people don't get hurt.
People do.
I think 95% of the mergers that occur are shameful failures.
D
Are either of the families planning on voting with their stock (by selling)?
Amazing magic tricks
I personally don't like HP and I LOVE Compaq. I don't give a damn what anyone else thinks, I LOVE the Proliant server line. I have been doing this pushing 20 years and I'd put a Compaq box up against anything.
To start: Me Too.
I've been buying and running Compaq servers for as long as I've been working on servers, about eight years now. Compaq builds a kick-ass server, but this merger is going to make me walk away from them. About two years ago I started buying desktops and laptops from IBM, the Thinkpad is just killer, but with HP most likely influencing Compaq's server line in a negative fashion I am pretty sure I am going to start buying IBM servers. What this means to me is that I will buy IBM until Big Blue gives me a reason not to.
NPR, surprisingly enough, had a short segment on this last week. They interviewed some sysadmins and asked what we thought. A lot of guys felt like I do, either for HP or for Compaq, and as a result of the unknowns of the merger were going to pull business, others liked one's workstations and the other's servers and hoped the merger would keep what they perceived as the best of both worlds.
No one knows what is going to come out of this, but what I do know is that for the forseeable future IBM has a new server customer or few.
Read the EFF's Fair Use FAQ
Anyway we'll be watching what happens to the Proliant line and begin evaluating the IBM offerings.
When someone yells "Stop" or goes limp, or taps out, the fight is over.
45% For
44% Against
11% Buchanan
Damn that butterfly ballot!
Remember "Bring 'em on"? *sigh
There's a funny thing about proxy votes. The more stock you own the more your vote means. Also, because this is a proxy vote the proxy has a mini vote and the majority choice is cast as a single vote from the proxy. If you've got 100 people behind a proxy and 40 vote against the merger, the proxy vote will be one for the merger. Add up enough proxies and you've got a sizable number of people voting against the merger. Fiorina is declaring victory far too soon in my opinion and according to most of the business papers I've been reading the opinion of many.
I don't get the projected numbers Fiorina has been throwing in everyone's faces. In all honesty she wants Compaq for production lines, some IP, and retail contracts with most notably Radio Shack. Between Radio Shack and WalMart Hewpaq would have a pretty big retail presence. Not everybody has a Best Buy, CompUSA, or Circuit City within an hour drive. They probably however have a RS or WalMart within an hour drive. If people are interested in a PC, retail chains are where they head to. However unlike the 2 + 2 = 5 numbers Fiorina is pulling out, HP and Compaq would not be expanding their markets. They would just consolodate shelf space. This doesn't lead to higher growth.
HP has gone from a company that actually progessed the state of technology to merely a competitor to Dell for presence on the desk. In the short term with decreased competition in retail space from Compaq, HP will do well. In the long run when the retail chains Hewpaq relies on start doing poorly they are going to suffer severly. In the said areas where HP and Compaq are prevelent, for some the only two choices, the market is going to become saturated very quickly due to the lack of demand. Sales of both companies' systems are already low, merging would just mean they would be collectively low even if their overall market penetration was greater than that of IBM. It's also funny how HP has twenty billion to spend on the Compaq merger yet needs to lay off 15,000 people. Next to go from HP will be their printer business at which point Dave Packard and Bill Hewlett will lead an army of zombies and demons out of Hell into Cupertino to make off with Carly and her minions.
I'm a loner Dottie, a Rebel.
I hope this sends a message to the Hewlett and Packard families that they've lost control of the company that bears their name. "The HP Way" (a trademark stolen from one of the cofounders) hasn't existed at Hewlett Packard for years now.
I voted for this merger because I'd much rather see Walter Hewlett resign from the board of directors and the Hewlett and Packard families start pulling their money out of this lost cause. Plus they'll lay off some 5 million more workers some of whom will find new jobs at companies that are doing good in this world. Hopefully HP will be so kind as to call the new company "Compaq".
- A former employee of the now closed HP FPK facility (no I wasn't laid off).
Maybe now they'll upgrade my Compaq to an HP? Wouldn't that be nice?
Anything's an upgrade compared to a Compaq. Maybe that's what Compaq's head honchoes realize: they are upgrading!
Lack of eloquence does not denote lack of intelligence, though they often coincide.
Only 8!?! Sheeee-it... I work for HP (don't get me started.) and I have shares through the stock purchase plan as well as through the 401k plan. I counted them on yesterday...
I RECEIVED A TOTAL 49 SEPERATE MAILINGS.
Counting Propaganda letters from both sides, proxy cards, printed booklets, Airborne Express overnight return envelopes (Must be 10 bucks a pop).
I had heard that each mailing cost between $2 - 3 Million. But I'm not bitter since my web team can't get training, equipment, or even software packages to actually accomplish our job.
I love this company, but I fear we are heading right down the proverbial shitter.
*sigh*
He's totally creeping out the Great One, eh...