The U.S. Federal Trade Commission (FTC) requested additional information into the workings of the proposed merger between Hewlett-Packard (HP) and Compaq Computer, according to documents HP filed with the U.S. Securities and Exchange Commission (SEC) on Thursday.
Opposition to the deal from the Hewlett and Packard families may delay the proposed merger; the FTC request will likely delay it as well. The FTC would neither confirm nor deny the information request on Friday.
FTC requests for more information are not unusual but not a standard action either, said an FTC spokesman. The request would be a precursor to any antitrust action taken by the commission against the companies.
The Hart-Scott-Rodino Act imposes a 30-day waiting period on mergers to allow the FTC time to either approve the deal, move to block the merger or to ask for more information, the spokesman said. If the FTC requests more information, the clock stops until the acquiring company -- in this case, HP -- substantially complies with the agency's request. After receiving all the requested information, the FTC has 20 days to either give its approval or oppose the merger.
Complying with the request for additional information can take a significant amount of time, HP said in the filing. The companies have not received required merger approvals yet from any governmental or regulatory agencies. HP and Compaq must be cleared by the European Commission, the Canadian Competition Bureau and U.S. antitrust law to complete the merger.