Packard son joins Hewletts in merger fight
David Packard, the only son of Hewlett-Packard co-founder Dave Packard, has backed Walter Hewlett in the Hewlett family's decision to oppose the HP-Compaq merger.
But the remaining HP board members issued a statement reaffirming their support of the plan.
Packard said he was displeased with the direction HP had taken and made it known when he resigned from the HP board in 1999. He said he did not like the merger and claimed it would result in layoffs, which went against the company’s core values.
‘[The merger] depends on massive employment layoffs, at least 15,000, probably more,’ he said.
‘For over 50 years, one of HP’s fundamental corporate objectives has been to provide long-term employment for its people,’ Packard said.
‘Bill and Dave never developed a premeditated business strategy that treated HP employees as expendable.’
He went on to say: ‘I agree with Walter’s statement that gave a lot of business reasons why this merger is a bad deal, and I share all of those reasons.’
David Packard Junior is not part of the Packard Foundation, which owns 10.4% of HP shares and which could vote either way.
A representative for the David and Lucile Packard Foundation said it was conducting an independent analysis of the deal and ‘would be making a decision in the future.’
Meanwhile, HP said the board ‘thoroughly analysed this transaction and unanimously concluded this is the very best way to deliver the value our shareowners expect.’
‘I’m even more convinced of the power of this combination, particularly given the progress of our integration plans,” said Dick Hackborn, former chairman and executive vice president of HP.
Rob Enderle, an analyst at Giga Information Group, said the families can do a lot to influence both stockholder and employee opinion.
Resources & Whitepapers
Accounting Software The power of customisation in accounting systems
‘It is hard to believe that the Packard foundation won’t follow. These folks have been a team for decades,’ he said.
‘My sense is that the merger is dead at this point and the companies will now have to move on to something else.’
He added that both executive teams will be worried, as a failure at this level can result in a purge that starts at the top.
Links
HP/Compaq merger ‘just the beginning’