Hewlett: If merger fails, only Fiorina will go
- 13 March, 2002 14:25
One of the most vocal opponents of Hewlett-Packard's proposed acquisition of Compaq attempted to assure shareholders Tuesday that voting against the deal would not bring chaos to the upper ranks of HP's management.
If the planned US$24 billion deal is voted against by HP shareholders March 19, HP's senior management would remain largely intact except for the likely departure of Carly Fiorina, HP's chairman and chief executive officer, said Walter Hewlett, an HP board member and son of one of HP's founders, in a conference call Tuesday.
"I am convinced there will be no disruptions in the day-to-day operations of HP if the merger is voted down," said Hewlett, continuing his campaign to block the merger.
He reiterated his argument that a union between HP, in Palo Alto, California, and Compaq, in Houston, would place too much emphasis on the companies' unprofitable PC and low-end server businesses. Instead, he called for HP to focus on strengthening its high-end server line, services business and imaging and printing operations.
If shareholders see eye-to-eye with Hewlett and vote against the deal, Fiorina would likely leave the company, he said.
"(The senior management team) are all good people, all valuable and all doing a good job," Hewlett said. "The only change we need in my opinion will be a new CEO."
Hewlett is the lone objector to the deal on HP's board. Other board members have made statements in recent weeks signalling their support for the merger. Members of the Packard family also have said they oppose the deal. The Hewlett and Packard families and their foundations control close to 18 percent of HP's shares.
HP executives have continued to fight Hewlett word for word on the issue, saying they support a combined company because it would give HP a leadership position in various hardware and software businesses. In addition, they have argued that the merger would help the company build out its services organization and compete more effectively against IBM Corp. in the lucrative services market.