4 Pension Funds Oppose HP Deal

Dissident Hewlett-Packard Co. director Walter Hewlett gained ground in his bid to scuttle the Compaq Computer Corp. acquisition, as four state pension funds said they would vote against the Palo Alto computer company’s proposed deal.

Officials for the New York State Teachers’ Retirement Fund, the New York State Common Retirement Fund, the State of Michigan Retirement Systems and the Public Employees’ Retirement Assn. of Colorado said they planned to vote their 15.5 million HP shares, representing about 0.8% of the shares outstanding, against the $20-billion deal.

Retirement funds in Florida, Ohio, Pennsylvania and Wisconsin said they planned to vote in favor of the deal. Together, they represent more than 8.5 million shares, or about 0.43% of HP’s shares outstanding.

Walter Hewlett has been battling Chief Executive Carly Fiorina to determine the future of the world’s second-largest computer maker. With three days to go before Tuesday’s vote, shareholders representing 23.01% of the company’s stock have indicated they will oppose the deal; shareholders representing 8.75% have said they will vote in favor of it.

Also on Friday, HP said the combined company would have earned 16 cents a share in HP’s fiscal first quarter. By itself, HP had profit of 25 cents a share.

HP shares fell 35 cents to $19.05 and Compaq fell 37 cents to $10.33, both on the New York Stock Exchange.