Essay on Compaq HP Merger

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Compaq HP Merger

"There is no more dramatic or controversial activity in corporate finance than the acquisition of one firm by another or the merger of two firms. It is the stuff of which reporter's dreams are made, and it is also an embarrassing source of scandal."(Ross,S.1996)

A merger refers to the absorption of one firm by another. The acquiring firm retains its name and its identity, and it acquires all of the assets and liabilities of the acquired firm. After a merger, the acquired firm ceases to exist as a separate business entity. In resent years, more and more merger and acquisition happened for those big companies as a result of intense competition in the business world. To maintain
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Compaq provides industry-leading enterprise computing solutions, networking and communication products, fault-tolerant business-critical solutions, portable products and consumer PCs, commercial desktop. Customers of the company include, home users, business interests, government and educational users. The products of the company include industry-standard servers, business-critical servers, storage products, portables, monitors, desktops, workstations, handhelds, Internet access devices, life-cycle management products, desktop PCs, printers and related products. The company operates mainly in Japan, North America, Asia-Pacific, Latin America, China, Europe, the Middle East and Africa. In fiscal year 2001, Compaq reported revenues of $33.6 billion. Enterprise computing accounted for 34% of 2000 revenues; consumer pc 18%; commercial personal computing 31%; Compaq global services, 16% & other, 1% (http://thenew.hp.com/).

Compaq Computer Corporation was founded in February 1982 by Rod Canion, Jim Harris and Bill Murto, three senior managers who left Texas Instruments and invested $1,000 each to form their own company. The first product was a portable

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