By Maxine Shapiro, KERA 90.1 commentator.
Dallas, TX – While the market anxiously awaited yesterday's statement by the Fed confirming what everybody thought the statement would contain - a neutral stance - lots of news was brewing on the merger and acquisition front. I'm Maxine Shapiro with KERA Marketplace Middays.
So you thought you had to wait in long lines at the polls last week? And you think political elections are the only points of contention worth watching? Then you've been missing the battle of wills in the computer mega-merger of Hewlett-Packard and Compaq Computer. It has intrigue, name-calling, and it just might be too close to call although one side has already claimed victory. The CEO of Hewlett-Packard, Carly Fiorina, began her campaign in mid-December to sell the idea of acquiring Compaq. This would help her company, which had been waning long before September 11th. Compaq was on board. Unfortunately, the sons of each of the co-founders of Hewlett-Packard were not, and tensions mounted, to say the least. The most vocal of the sons was Board member and H-P heir, Walter Hewlett. Well, yesterday, over one thousand shareholders filled an auditorium to hear speeches and vote on the merger. Today, Compaq votes. Although today's vote is expected to be positive for the merger, yesterday's might take weeks before the final tally is in. No matter what the final results, life at both companies will be very different after this bitter battle has ended.
On the local front, Sabre Holding Corporation, who has been trying to acquire the remaining stock of Travelocity.com, got smart and raised their bid price by 22%. Sabre now holds 70% of the stock and needs at least 90% for the takeover. Unwisely, Sabre's first offer was well below market value and an independent group set up by Travelocity could not rightfully accept the deal. This new bid by Sabre should make everybody happy. And according to the Dallas Business Journal Online, Sabre would settle all pending "shareholder suits that sought to prevent Travelocity from accepting the original offer." Though unfriendly at first, this is a nice merger. For KERA Marketplace Middays, I'm Maxine Shapiro.
Marketplace Midday Reports air on KERA 90.1 Monday - Friday at 1:04 PM.