>From http://www.digital.com/flash/f192/:
Compaq to Acquire DIGITAL for $9.6 Billion
Compaq Computer Corporation (NYSE: CPQ) and Digital
Equipment Corporation (NYSE: DEC) today announced the
completion of a definitive merger agreement. As Compaq
continues its drive to become the global leader in
enterprise computing solutions, this latest acquisition
greatly accelerates its momentum and strengthens its value
proposition to customers.
"We put tremendous value on the customer relationships
Digital has cultivated over the past 40 years. We are
committed to supporting these key customer relationships by
investing in Digital's strategic assets, particularly its
worldwide service organization, as well as its 64-bit
leadership with Alpha microprocessors, OpenVMS, Digital UNIX
and Windows NT enterprise systems, open storage and software
products," said Eckhard Pfeiffer, president and CEO, Compaq.
"Digital's focused enterprise strategy coupled with
demonstrable improvements in operational performance make
this a timely choice for us," Pfeiffer said. In Digital's
recently reported second quarter, profits doubled and the
company experienced tremendous growth in its target markets.
The transaction will be the largest acquisition in the
history of the computer industry, valued at $9.6 billion
based on the January 23, 1998 closing price of Compaq common
stock. Under the terms of the transaction, shareholders of
Digital will receive $30 in cash and approximately 0.945
shares of Compaq common stock for each share of Digital
stock. Compaq will issue approximately 150 million shares of
Compaq common stock and $4.8 billion of cash. Under the
terms of the agreement, Digital will become a wholly owned
subsidiary of Compaq.
"The combined companies will provide significant economic
value growth for our shareholders," said Earl Mason, chief
financial officer of Compaq. "In addition, the combination
will be accretive within a year, meeting all of Compaq's
economic tests."
"This merger gives Digital tremendous reach and credibility
in the marketplace," said Digital Chairman Robert B. Palmer.
"It gives us the scale and resources to make continued
investments in our key technologies and services. Customers
will benefit from the very complementary strengths of both
companies. For example, together we will offer customers the
greatest concentration of enterprise Windows NT products and
lifecycle services available in the market today."
More info at
http://www.digital.com/flash/compaq-pr.html
Received on Mon Jan 26 1998 - 14:52:26 NZDT