HP, Compaq CEOs Push Merger Plans

Hewlett-Packard Co.’s Carly Fiorina and Compaq Computer Corp.’s Michael Capellas met Wednesday with Hewlett-Packard’s largest shareholder to push their plans to combine the two computer giants.

The two chief executives addressed the finance committee of the board of the David & Lucile Packard Foundation, said George Vera, the foundation’s chief financial officer. The foundation owns 10.4% of Hewlett-Packard’s shares.

“They asked for this meeting and we agreed,” Vera said. “This is part of our analysis phase.”

Vera and spokesmen for the companies declined to disclose details of the discussions.

Since the proposed $25.2-billion acquisition was announced Sept. 3, some relatives of Hewlett-Packard’s founders have opposed the purchase. The David & Lucile Packard Foundation’s decision on how to vote on the sale may sway other investors, making its support crucial to winning approval.

Walter Hewlett, son of co-founder William Hewlett and a company director, said in a regulatory filing Wednesday that the acquisition would reduce earnings more than expected when the companies announced the deal because Compaq’s business prospects have dimmed. David Packard, son of the company’s other co-founder, also has criticized the deal.

The shares of Palo Alto-based Hewlett-Packard rose 82 cents, to $23.32, their highest closing price since the acquisition was announced. Houston-based Compaq rose 86 cents to $11.65 and has fallen 5.7% since the deal was disclosed. Both trade on the New York Stock Exchange.

Fiorina has said the second-biggest computer maker needs Compaq to increase its sales force and server products and boost its services business.

The 12-member board of the Packard Foundation, based in Los Altos, will meet Friday to discuss how to vote on the acquisition.