Abstract

This is the first of a four-case series. Hewlett-Packard (HP) has acquired Compaq for $25 billion in stock, in the biggest ever buy-out in the history of the computer industry. The merged entity, with operations in more than 160 countries and over 145,000 employees, offers a comprehensive range of information technology products and services. Carly Fiorina, Chief Executive Officer of HP, is confident that the new HP will become the global leader in terms of revenues for servers, access devices (personal computers and hand-held devices), and imaging and printing. All the directors except Walter Hewlett, son of founder William Hewlett, endorse the deal. Hewlett believes that integrating the two companies will be an arduous task and could take many years. Meanwhile, employees of Compaq and HP are becoming concerned about job losses and cultural differences.

Learning Objectives

The case is structured to achieve the following Learning Objectives:

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Keywords

Hewlett-Packard, HP, Compaq, Carly Fiorina, Acquisition, Takeover, Integration problems, Family, Corporate strategy, Restructuring