HP, Compaq Notify EU of Proposed Merger

Hewlett-Packard Co. and Compaq Computer Corp. have notified European Union regulators of their intention to merge, showing confidence in the $22.2-billion deal despite opposition from big shareholders, officials said.

The request for antitrust clearance followed extensive preliminary talks with officials in Brussels. The deadline for the initial review is Jan. 31, EU spokeswoman Amelia Torres said.

Unlike in the United States, a strict timetable is triggered once the EU is formally notified of a planned merger.

If problems are not resolved in the first phase, which lasts one month, an in-depth review is automatically launched, which takes four months.

The decision to notify on the deal showed the companies still had faith it would be approved by shareholders, despite the opposition of Hewlett and Packard family interests with 18% of HP stock.

A shareholder vote is expected early next year.

HP stock rose 30 cents to $21, while Compaq rose 82 cents to $9.94. Both trade on the New York Stock Exchange.

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Associated Press