Friday, March 08, 2002
I'm hoping that the HP/Compaq merger goes through. That's certainly runs counter to what the "conventional wisdom" regarding the merger currently is, but that seems typical of me lately. The griping about all the problems related to the merger strikes me as a bunch of armchair quarterbacks lecturing the professional how he SHOULD have executed on a particular play.
The fact of the matter is, no one knows their respective businesses as well as the management team at HP and Compaq. This merger may in the end be a BAD idea, but I think it's worth letting the parties involved to at least try to make it work. Right now, both HP and Compaq aren't really leading the industry in any spectacular way. SOMETHING must be done different if they want to regain the industry leadership they once had. "Doing things the HP way" might have worked thirty years ago, but it's not working as well now.
Ms. Fiorina deserves the chance to find out whether she's right about this merger. Compaq absorbed Digital years back, which in the end turned out to be a bad merger. Still, there wasn't quite the hue and cry that the HP/Compaq merger seems to be creating in the popular press. I'm only left wondering if all this nonsense isn't a result of the fact that HP's Fiorina is female. If Lou Gerstner (IBM's former CEO and male, at least as far as I know) had been the originator of this merger proposal, would the popular press (or Walter Hewlett) been quite so strident in their opposition?
I'm somewhat surprised that so many investors are seriously considering opposing this merger. Has any of them seriously considered the fallout should this merger fail? They've spent a year and hundreds of millions preparing for this merger. If it fails, they have to start from scratch and rethink their business plan, not to mention write off those hundreds of millions. That should cause some serious downward pressure on HP and Compaq stock, an event which will drive them ever further behind in the market. Is that what investors really want?
The fact of the matter is, no one knows their respective businesses as well as the management team at HP and Compaq. This merger may in the end be a BAD idea, but I think it's worth letting the parties involved to at least try to make it work. Right now, both HP and Compaq aren't really leading the industry in any spectacular way. SOMETHING must be done different if they want to regain the industry leadership they once had. "Doing things the HP way" might have worked thirty years ago, but it's not working as well now.
Ms. Fiorina deserves the chance to find out whether she's right about this merger. Compaq absorbed Digital years back, which in the end turned out to be a bad merger. Still, there wasn't quite the hue and cry that the HP/Compaq merger seems to be creating in the popular press. I'm only left wondering if all this nonsense isn't a result of the fact that HP's Fiorina is female. If Lou Gerstner (IBM's former CEO and male, at least as far as I know) had been the originator of this merger proposal, would the popular press (or Walter Hewlett) been quite so strident in their opposition?
I'm somewhat surprised that so many investors are seriously considering opposing this merger. Has any of them seriously considered the fallout should this merger fail? They've spent a year and hundreds of millions preparing for this merger. If it fails, they have to start from scratch and rethink their business plan, not to mention write off those hundreds of millions. That should cause some serious downward pressure on HP and Compaq stock, an event which will drive them ever further behind in the market. Is that what investors really want?
