Close
  • Latest News
  • Big Data and Analytics
  • Cloud
  • Networking
  • Cybersecurity
  • Applications
  • IT Management
  • Storage
  • Sponsored
  • Mobile
  • Small Business
  • Development
  • Database
  • Servers
  • Android
  • Apple
  • Innovation
  • Blogs
  • PC Hardware
  • Reviews
  • Search Engines
  • Virtualization
Read Down
Sign in
Close
Welcome!Log into your account
Forgot your password?
Read Down
Password recovery
Recover your password
Close
Search
Logo
Logo
  • Latest News
  • Big Data and Analytics
  • Cloud
  • Networking
  • Cybersecurity
  • Applications
  • IT Management
  • Storage
  • Sponsored
  • Mobile
  • Small Business
  • Development
  • Database
  • Servers
  • Android
  • Apple
  • Innovation
  • Blogs
  • PC Hardware
  • Reviews
  • Search Engines
  • Virtualization
More
    Home Latest News
    • PC Hardware

    Hewlett: Fiorina Gone If Merger Fails

    By
    eWEEK EDITORS
    -
    March 13, 2002
    Share
    Facebook
    Twitter
    Linkedin

      Walter Hewlett, touting growing opposition to Hewlett-Packard Co.s proposed $22 billion buyout of Compaq Computer Corp., this week predicted that HP Chairman and CEO Carly Fiorina will be ousted if the deal is rejected by shareholders next week.

      “This will be her second aborted merger in less than two years, and she wont have the credibility to lead the company,” Hewlett said on Tuesday in a conference call with investors and industry analysts.

      Hewlett asserted that HPs large shareholders were not swayed by last weeks favorable report on the proposed merger by an influential advisory group, Institutional Shareholder Services, and predicted most would vote against the deal.

      That claim gained considerable weight Wednesday when HPs third largest institutional shareholder, Banc of America Capital Management, which owns a 2.73 percent stake in the company, announced it would vote against the deal. However, Banc of America can only vote for about 12 percent of the 53.4 million shares it owns, since most of its shares are controlled by its clients.

      Excluding shares controlled by Hewlett and the Packard families, who have also denounced the merger, three of HPs top shareholders have declared their opposition to the merger. The other two are Brandes Investment Partners and the California Public Employees Retirement System.

      In one of his most dire assessments of the proposed buyout to date, Hewlett warned that should HP acquire Compaq and move to become an end-to-end solutions provider, it could ultimately lead to the companys demise.

      The merger “could will lead to a lack of focus, and that has lead many conglomerates to their downfall,” he said.

      If shareholders reject the deal, Hewlett said he would help guide efforts to find a replacement for Fiorina.

      While Hewlett did not suggest a possible candidate, he did offer a damning assessment of Fiorinas performance since she was named CEO in July 1999, at which time she was serving as president of Lucent Technologies Global Service Provider Business.

      “I believe we will look for a current CEO with a track record for creating shareholder value and not get a CEO who again is learning on the job,” Hewlett said.

      The fate of HPs proposed buyout of Houston-based Compaq will be determined March 19 when the computer makers investors will vote on the merger at a special gathering in Cupertino, Calif. While the boards of HP and Compaq have approved the deal, the merger must win the approval of more than 50 percent of each companys shareholders.

      While Compaq shareholders are widely expected to approve the buyout when they vote March 20 in Houston, HPs vote is considered a tossup, due to heavy lobbying against the merger by Hewlett, an HP director who initially joined in a unanimous vote in favor of the merger by the companys board of directors.

      In November, a month after the deal was announced, Hewlett criticized it and initiated a proxy fight. In December, the Packard family foundation announced that it, too, opposed the deal. Together, the families control about 17 percent of HPs stock.

      HP executives contend the merger would give the company market leadership in six core business segments, double its services revenue, lead to $2.5 billion in annual cost savings, and dramatically boost its ability to compete in an increasingly competitive industry.

      Hewlett claims that massive high-tech mergers nearly always fail, and that this deal would undermine profits, reduce shareholder value and increase HPs exposure to the slumping PC market. Instead, hes proposed an alternative strategy, which he calls “execute and focus,” that would focus leveraging HPs leadership in imaging and printing, increasing product profit margins through technological innovations, and reducing operating costs in its PC and server businesses.

      eWEEK EDITORS
      eWeek editors publish top thought leaders and leading experts in emerging technology across a wide variety of Enterprise B2B sectors. Our focus is providing actionable information for today’s technology decision makers.

      MOST POPULAR ARTICLES

      Android

      Samsung Galaxy XCover Pro: Durability for Tough...

      Chris Preimesberger - December 5, 2020 0
      Have you ever dropped your phone, winced and felt the pain as it hit the sidewalk? Either the screen splintered like a windshield being...
      Read more
      Cloud

      Why Data Security Will Face Even Harsher...

      Chris Preimesberger - December 1, 2020 0
      Who would know more about details of the hacking process than an actual former career hacker? And who wants to understand all they can...
      Read more
      Cybersecurity

      How Veritas Is Shining a Light Into...

      eWEEK EDITORS - September 25, 2020 0
      Protecting data has always been one of the most important tasks in all of IT, yet as more companies become data companies at the...
      Read more
      Cybersecurity

      Visa’s Michael Jabbara on Cybersecurity and Digital...

      James Maguire - May 17, 2022 0
      I spoke with Michael Jabbara, VP and Global Head of Fraud Services at Visa, about the cybersecurity technology used to ensure the safe transfer...
      Read more
      Big Data and Analytics

      GoodData CEO Roman Stanek on Business Intelligence...

      James Maguire - May 4, 2022 0
      I spoke with Roman Stanek, CEO of GoodData, about business intelligence, data as a service, and the frustration that many executives have with data...
      Read more
      Logo

      eWeek has the latest technology news and analysis, buying guides, and product reviews for IT professionals and technology buyers. The site’s focus is on innovative solutions and covering in-depth technical content. eWeek stays on the cutting edge of technology news and IT trends through interviews and expert analysis. Gain insight from top innovators and thought leaders in the fields of IT, business, enterprise software, startups, and more.

      Facebook
      Linkedin
      RSS
      Twitter
      Youtube

      Advertisers

      Advertise with TechnologyAdvice on eWeek and our other IT-focused platforms.

      Advertise with Us

      Menu

      • About eWeek
      • Subscribe to our Newsletter
      • Latest News

      Our Brands

      • Privacy Policy
      • Terms
      • About
      • Contact
      • Advertise
      • Sitemap
      • California – Do Not Sell My Information

      Property of TechnologyAdvice.
      © 2021 TechnologyAdvice. All Rights Reserved

      Advertiser Disclosure: Some of the products that appear on this site are from companies from which TechnologyAdvice receives compensation. This compensation may impact how and where products appear on this site including, for example, the order in which they appear. TechnologyAdvice does not include all companies or all types of products available in the marketplace.

      ×