This story was written by Keith Dawson for the Industry Standard's Media Grok email newsletter. It is archived here for informational purposes only because The Standard's site is no more. This material is Copyright 1999-2001 by Standard Media.

Downbeat on HewPaq

Sep 07 2001 07:56 AM PDT

The HP-Compaq deal gets an ice-cold reception.

We started the week with the earthquake of the proposed HP-Compaq merger. Let's end it by browsing through the rubble.

In SmartMoney, fund manager Donald Luskin set the tone with his title ("Assisted Suicide for Corporations") and inquired sweetly, "Why do ... we call it a blockbuster when the company whose major claim to fame is that it has cornered the market in toner dust marries the box maker that serves as an elephant graveyard for the computer giants of the 1970s?"

In a guest opinion piece in, Forbes ASAP's Michael S. Malone waxed nostalgic for the greatness that was Hewlett-Packard when it was guided by its founders' vision. Malone wrote that HP CEO Carly Fiorina "has decided to bet Hewlett-Packard on a fading industry that her predecessors would have long since abandoned."

Writing in TheStreet, hedge-fund manager David Brail dissected the deal in clinical detail. "I can't recall a deal that has gotten a worse reception," wrote Brail, who continued self-referentially, "This merger has received more column inches of coverage than any transaction in recent memory." Brail's verdict: "This one could be DOA."

Not to be outdone in over-the-top calumny, the New York Times quoted analyst Toni Sacconaghi's opinion that the drops in both companies' stock prices represent "an outpouring of negative emotions" about the merger. "What I hear people saying is that they think the core business could be destroyed in the process."

Have a nice weekend.

Assisted Suicide for Corporations

The HP 'Why?' Fiorina is sinking a once-great company

San Francisco Chronicle

H-P, Compaq Deal Wins a Big Thumbs Down

Compaq and Hewlett Face More Skepticism
New York Times