Preview

Case 1 M A Merger HP Compaq First Final

Good Essays
Open Document
Open Document
987 Words
Grammar
Grammar
Plagiarism
Plagiarism
Writing
Writing
Score
Score
Case 1 M A Merger HP Compaq First Final
Global Executive MBA – FGV (2015)

Course 303: Mergers and Acquisitions
Professor: Hsia Hua Sheng
Department: Accounting, Finance and Controls, Module: 3/2015

Assignment # 1
The merger between Hewlett Packard and Compaq

Local Team 2

Mark Hollenstein
Andre Nadjarian
Glasson Fonseca
Patricio Ducó

Jan 8th , 2014

1. What would a SWOT analysis of HP and Compaq reveal?

Hewlett Packard

Compaq

The main takeaway from this analysis is that the macro environment was tough, especially after the 9/11 attack and the technology industry was getting increasingly competitive and ever-changing. Therefore, even though both companies had their strengths, management was aware that the same business model would not last much longer. They were both clinging from very weak businesses: HP from the imaging and printing solutions that was already threatened by other brands and was evolving into digital solutions. Compaq was relying on a PC distribution model that was already showing signs of decay, especially shown by the negative operating margins they had even though they were the leaders in the market.
Clearly they both needed a profound change and understood that combining with a company with opposite strengths could be a viable solution to ensure continued growth and the needed skills to adapt their model for the future, where enterprise services was developing fast (as shown by IBM resurgence) and the PC industry demanded a low-cost distribution model.
2. What are the critical resources at HP? And at Compaq? Does Compaq complement HP?

For HP the critical resources were the printing and imaging solution, which was at that time a high demand market segment for which they had the leadership but had low growth potential. On the other hand they offered good computing products, like notebooks, servers, desktops and storage products but has an inefficient distribution model. Finally, an IT service was a new segment that was under development. The last two

You May Also Find These Documents Helpful

  • Good Essays

    First, HP maintained its focus on the market. During the World War II, HP’s strategy of only focus on “building a group of complementary products rather than becoming involved in a lot of un related things” reduced the damage to the company after the war ends. Otherwise, it may not survive when facing a 50 percent decline in revenue. Meanwhile, as a high-tech venture focus on innovation products, HP's design engineers find the needs of customer by determining whether the product met the needs of fellow engineer sitting at the next bench within the company rather than depending on market research. It helped HP understand its market’s needs and was a successful approach in HP’s early day.…

    • 580 Words
    • 3 Pages
    Good Essays
  • Better Essays

    Greeley Hard Copy

    • 1217 Words
    • 5 Pages

    1. Describe the HP organizational Culture. What are some implications of this culture for developing new innovations? What is evidence of R&D’s dominance in HP?…

    • 1217 Words
    • 5 Pages
    Better Essays
  • Better Essays

    Kittyhawk

    • 2354 Words
    • 9 Pages

    It can be said that the company has always strived to take the lead in terms of high performing products in the market. With this said, HP has always had significant competition among other companies in the same market realm. They have managed to keep industry norms to par as well as excelling in product launch and innovation.…

    • 2354 Words
    • 9 Pages
    Better Essays
  • Good Essays

    3. In the late 1980s there had been a wave of mergers. The companies had become vulnerable to mergers because they ignored changing demographics and emerging forms of retailing, failed to control high expense structure and integrate operations. In the backdrop of these mergers, McGregor believes that even though the company is doing well it needed to further improve its profitability, efficiency and turnover to prevent trouble.…

    • 1269 Words
    • 7 Pages
    Good Essays
  • Satisfactory Essays

    Yincom and Yangnet case

    • 377 Words
    • 2 Pages

    We need to work together to go through the difficult transition because the two companies had different, even contrasting, cultures and beliefs. Putting together two "number twos" doesn't necessarily create a winner.…

    • 377 Words
    • 2 Pages
    Satisfactory Essays
  • Good Essays

    HP entered into an agreement with Compaq Computer Corporation in September 2001. In this definitive agreement, HP is going to purchase all of Compaq’s common shares outstanding, and pay a total price of 0.6325 shares of its common stock for each share of Compaq’s common stock.…

    • 1206 Words
    • 5 Pages
    Good Essays
  • Satisfactory Essays

    In January 2002 HP faced extraordinary challenges: - HP was adjusting to a major reorganization, which reconfigured over 80 separate business units into just 4 global business units. - The company was completing and implementing its merger with Compaq. - The backdrop was a weakened economy following September 11 and the dot-com downfall, forcing the first largescale layoffs in the company's history.…

    • 506 Words
    • 3 Pages
    Satisfactory Essays
  • Powerful Essays

    During the 1990s, both companies experienced major challenges to their historic competitive positions and organizational models and at the end of the decade; both companies were struggling to reestablish their competitiveness. At the start of the new millennium, new CEOs at both companies were implementing yet another round of strategic initiatives and organizational restructurings. Observers wondered how the changes would affect their long running competitive battle.…

    • 7249 Words
    • 29 Pages
    Powerful Essays
  • Better Essays

    The case study reflects the appraisal of HP’s high performers, internal and external problems and the growth of the company’s future. We see their sales have grown but profits have fallen $230 million short. With a slow economy on the rise HP needs to find a solution to their growth problem. A clear cut to their problem I suggested is by merging with the rival company Compaq due to their same visions and tactics and it will decrease the competition while strengthening the company’s image in business field.…

    • 1806 Words
    • 8 Pages
    Better Essays
  • Satisfactory Essays

    marketing channels pdf

    • 425 Words
    • 2 Pages

    3) What are the benefits which a consumer might obtain via an HP presence on the Internet…

    • 425 Words
    • 2 Pages
    Satisfactory Essays
  • Satisfactory Essays

    5) The difference with HP PPM, the competitive advantage and example of another company realizing same benefits.…

    • 595 Words
    • 3 Pages
    Satisfactory Essays
  • Good Essays

    Lamp and Philips

    • 377 Words
    • 2 Pages

    During the first decade of the 21st century, however, both companies experienced major challenges to their historic competitive positions and organizational models. Implementing yet another round of strategic initiatives and organizational restructurings, the CEOs at both companies were taking their respective organizations in very different directions. At the end of the decade, observers wondered how the changes would affect their long-running competitive battle.…

    • 377 Words
    • 2 Pages
    Good Essays
  • Best Essays

    Hp Cisco

    • 4787 Words
    • 20 Pages

    Casciaro, Tiziana and Christina Darwall. The HP-Cisco Alliance (B). Boston: Harvard Business Publishing, 2003. Print.…

    • 4787 Words
    • 20 Pages
    Best Essays
  • Satisfactory Essays

    Ebao

    • 404 Words
    • 2 Pages

    Income was traditionally paper-based and this resulted in tedious efforts and consumption of time therefore they installed the HP 3000 mainframe. However, it suffered the following problems…

    • 404 Words
    • 2 Pages
    Satisfactory Essays
  • Better Essays

    Yoho

    • 8036 Words
    • 33 Pages

    IBM had a very good year in 1990. John Akers had guided his company through three major rounds of corporate restructuring since 1985, and he was proud of IBM's accomplishments. Recent product introductions were being hailed as technical breakthroughs with great market potential, the stock price had recovered, and internal morale was improving. Akers was determined that IBM be viewed as the world-class competitor in its field, and all the signs were pointing in the right direction-profits were growing again and IBM remained the market share leader in each of its businesses. But after an outstanding fourth quarter, Akers had to tell his shareholders in March 1991 that operating profits would be down sharply in the latest three months as a result of lower sales in the U.S. and Europe. Concerned about the magnitude of the downturn, the competitive Akers was growing impatient with the time it was taking to transform IBM, especially the vexing problems of meeting deadlines and getting the organization to be aggressive in solving quality issues and delivering on commitments. Akers challenged his senior management team: “How do we respond to this latest decline? Should we restructure ourselves to anticipate lower growth? And how do we improve our execution?" Akers made it clear that all options should be on the table.…

    • 8036 Words
    • 33 Pages
    Better Essays

Related Topics