HP, Compaq to Offer a Peek at Post-Merger Life

Next week, Hewlett-Packard and Compaq Computer will begin releasing to their employees details about the merged company's organizational structure and its selection process for filling positions.

HP's plan to cut 15,000 positions worldwide following its acquisition of Compaq was among its employees' top concerns during the drawn-out proxy fight over the acquisition, HP acknowledged throughout the process. HP frequently warned its staff that decisions about job cuts, which the company says will take place gradually over the next two years, may not be immediately forthcoming once the deal closes.

But in a memo to employees sent Wednesday and signed by HP's chairman and CEO Carly Fiorina and Compaq's chairman and CE Michael Capellas, the companies say that next week they will release an overview of the selection process for filling jobs in the new HP. The overview will include "guiding principles and a broad timeline," according to the memo.

The companies also plan to announce next week some of HP's new top executives, including managers who will report directly to the management team. HP has already said that Fiorina will retain her current positions while Compaq's Capellas will become HP's president; but the company has remained quiet about its plans to fill other top spots.

Working Together

The memo to staff follows a similar missive sent Tuesday in which HP said that it plans to complete the acquisition of Compaq and begin operating as a merged company within the next two months.

The integration-planning announcements come despite the absence of an officially certified tally of last week's shareholder vote. ISV Associates, a small firm based in Newark, Delaware, is handling analysis of the ballots cast at HP's shareholder meeting and certification of the vote, a process it expects to take several weeks.

HP says that its proposal to acquire Compaq received shareholder approval, though merger opponent and HP board member Walter Hewlett maintains that the vote was too close to call.

According to HP's preliminary vote count, the acquisition was backed by a "decisive" majority of institutional investors not affiliated with the Hewlett and Packard families, the company said in Wednesday's staff memo. Also voted in favor of the merger were a majority of the shares held by employees enrolled in HP's employee stock purchase plans, HP says.

HP will continue laying the groundwork for the merged company's launch, even though the vote's official outcome remains in dispute.

"Putting anything on hold while we wait for a final proxy vote tabulation is simply not an option. Therefore, we will continue to move forward aggressively with the integration and launch planning, so we can hit the ground running shortly after the legal close," the memo said.