Compaq Computer won't seek another buyer if its $21.3 billion merger with Hewlett-Packard falls through, Compaq CEO Michael Capellas says.
H-P is the "only deal for Compaq. I can't see any other combination in the industry that makes sense," a confident Capellas said in an hourlong interview. He was touring the West Coast to build support for what would be the largest deal in personal-computer history.
Capellas says he noticed a shift in momentum for the deal a month ago, when both companies posted better-than-expected financial results. "Investors gained confidence after they looked at this a second or third time," he said.
H-P shareholders vote on the deal March 19; Compaq shareholders on March 20.
Still, Compaq and H-P are leaving nothing to chance in the final hectic days of the increasingly bitter proxy fight. They are selling the deal with "excruciating details" after initially failing to show its benefits, says Compaq co-founder and former chairman Ben Rosen.
H-P and Compaq officials are working overtime to sway Institutional Shareholder Services, the influential adviser whose clients own 57% of H-P's shares. ISS will decide as early as Thursday where it stands on the merger. "We've been in constant contact the past few weeks with champions and critics of the deal," says ISS Vice President Pat McGurn.
News source: USA Today
H-P is the "only deal for Compaq. I can't see any other combination in the industry that makes sense," a confident Capellas said in an hourlong interview. He was touring the West Coast to build support for what would be the largest deal in personal-computer history.
Capellas says he noticed a shift in momentum for the deal a month ago, when both companies posted better-than-expected financial results. "Investors gained confidence after they looked at this a second or third time," he said.
H-P shareholders vote on the deal March 19; Compaq shareholders on March 20.
Still, Compaq and H-P are leaving nothing to chance in the final hectic days of the increasingly bitter proxy fight. They are selling the deal with "excruciating details" after initially failing to show its benefits, says Compaq co-founder and former chairman Ben Rosen.
H-P and Compaq officials are working overtime to sway Institutional Shareholder Services, the influential adviser whose clients own 57% of H-P's shares. ISS will decide as early as Thursday where it stands on the merger. "We've been in constant contact the past few weeks with champions and critics of the deal," says ISS Vice President Pat McGurn.
News source: USA Today
Meanwhile, big institutional investors Alliance Capital Management, Dodge & Cox and Vanguard Investments increased their holdings in H-P in the fourth quarter of last year in shows of support for the merger. Capellas also offered his takes on:
- The proxy fight: "Nobody anticipated it. ... It's a distraction."
- Being second fiddle to CEO Carly Fiorina in his role as president and chief operating officer at the new company: "I won't say that I won't feel it. I have blood in my veins. Of course I'll feel it."
- Accusations that Compaq sold excessive amounts of inventory to resellers to improve its bottom line and improve the merger's chances: "Our numbers are clean as a whistle."
Capellas says he'll spend the first six months of the merger meeting with customers and employees. He'll split time between Houston, where Compaq is based, and H-P in Palo Alto, Calif.
Industry observers say Capellas, 47, is best suited to combine the sprawling global operations of H-P and Compaq. "He skillfully integrated Tandem (Computers) and Digital into Compaq, and saved Compaq," says Thomas Perkins, a Compaq board member who is cofounder of venture capital firm Kleiner Perkins Caufield & Byers.
Adds Fiorina: "Michael is smart, aggressive and he's a self-professed geek who loves the technology. He connects with customers at a fundamental level. Those are all extremely valuable traits to bring to this new company."
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