Although the final outcome of last week’s Hewlett-Packard Co. (HP) shareholder vote on the acquisition of Compaq Computer Corp. has not yet been certified, HP is steaming ahead with plans to close the deal and launch the merged company within the next two months.
Twelve hundred HP and Compaq employees are now part of “clean teams” working full time on integration plans, the companies said Tuesday in a memo sent to employees and filed with federal regulators.
That staff count is up significantly from just one month ago, when several hundred employees were working on integration efforts. Some 500,000 working hours had by then been dedicated to integration planning, HP chairman and chief executive officer (CEO) Carly Fiorina said in late February at a meeting with securities analysts.
HP and Compaq said in Tuesday’s memo to staff that HP remains confident it has won shareholder approval of the acquisition, based on a preliminary analysis conducted by its proxy solicitor. Merger opponent and HP board member Walter Hewlett maintains that the vote’s outcome was too close to call.
Official tabulation and certification of the voting results is being handled by IVS Associates Inc. in Newark, Del., which expects its analysis of the ballots to take several weeks.
One of HP’s key goals in the integration process is to ensure the merged company would “open its doors and hit the ground running in the April-May timeframe,” the company said. HP is on target for that goal, according to the memo.
After the shareholder vote’s outcome is certified, legal documents to complete the merger must be finalized. HP hopes to launch the merged company within several days of the acquisition’s legal close, the company said.
A launch team is working with the new executive committee on plans for pre- and post-launch communication, HP said, including letters to employees, customers and partners from Fiorina, who will remain chairman and CEO of HP, and Compaq CEO Michael Capellas, who will become the company’s president.
Product road maps and branding plans are among the first items on the communication agenda, HP said. But company employees will likely have to wait to hear more about HP’s intention to cut 15,000 positions from the merged company.
“We must give top priority to decisions that maximize continuity and minimize service interruption in our customer-facing organizations,” HP and Compaq said in the memo to staff. “Our intent is to announce decisions around job selection and reduction as soon as we can. But those decisions and announcements will be driven by the strategies and operating plans of each business and implemented in accordance with relevant national and local laws.”
The two companies also exhorted employees to mind the boundaries between HP and Compaq until the companies merge.
“Please remember that Compaq and HP are required by law to function as competitors until legal close and the new company officially launches,” the memo said. “Employees who aren’t on clean teams should not engage with their counterparts in the other company unless and until instructed to do so.”