Walter Hewlett will not appeal a Delaware judge's dismissal of his lawsuit against HP, ending his long proxy fight to block the computer maker's buyout of Compaq.
Walter Hewlett will not appeal a Delaware judges dismissal of his lawsuit against Hewlett-Packard Co., ending his long proxy fight to block the computer makers $19 billion buyout of Compaq Computer Corp.
Hewlett issued a statement announcing his decision after Delaware Chancery Court Judge William Chandler III ruled late Tuesday that the HP heir had failed to prove the company misled its investors about the projected financial impact of the buyout or strong-armed a major institutional investor into voting for the deal last month.
"After reviewing the courts opinion, we have decided not to appeal the decision to the Supreme Court of Delaware," Hewlett said in his release. "Additionally, we have decided to discontinue the review and challenge period of the preliminary vote count and permit the vote to be certified."
According to a preliminary ballot count by IVS Associates, a Delaware firm charged with tallying the shareholder votes, HP investors approved the acquisition by 45 million votes, resulting in a slim 51.4 percent to 48.6 percent margin of victory, out of about 1.63 billion shares were voted.
While Hewletts decision not to appeal removes the last legal obstacle blocking the acquisition of Houston-based Compaq, two ongoing investigations by federal agencies still loom over the deal.
Last month, HP disclosed that the U.S. Attorneys Office for the Southern District of New York and the Securities Exchange Commission were investigating allegations similar to those made by Hewlett in his lawsuit. While neither the U.S. Attorneys Office nor the SEC will comment about their inquiries, Hewletts failure to convince a judge of the validity of his charges during a three-day hearing last week is widely seen as increasing the likelihood that neither of those probes will result in any action.
In conceding defeat, Hewlett, who was removed from HPs board of directors last week as a result of his opposition to the Compaq buyout, vowed that he would continue to be a force in the companys future.
"My involvement with HP will not end today," he said. "As Chairman of The William and Flora Hewlett Foundation and as a trustee of The William R. Hewlett Revocable Trust, I represent two major stockholders and I will continue to monitor the companys performance to ensure that it acts in the best interests of all stockholders."