Hp Compaq Case

Background ?Declining sales till 1999 ?Carly Fiorina believes in a structural flip in the industry ?HP could be a leading supplier of integrated solutions ?Transformed into a Web Services bolide ?Provided equipment and services for clients to do business on the internet ?Collapsed 83 self-employed person product lines into 17 product categories Fig. HP- Segments Fig.

HPs performance pains Analysis ?Short product life cycles ?Frequent innovations ?Price ? crossing characteristics ? jolting competition ?Strong focus on inorganic expansion Competitor Analysis ?IBM ? well(p)-service provider model ?Offered integrated solutions including software, hardware and services ?Greater focus on hosts and reposition devices ?One-stop shopping experience ?Dell ?Direct-to-customer business model ?Better understanding of consumer needs ?Focused on selling built-to-order PCs ?Rapid innovation and new product launches Product Marketing Initiatives ?Compaq ?Exclusive rights to dealers ?2-pronged approach since 1997 ?Direct internet sales ?Full service providers ?HP ?Diversification ?Imaging and Printing ?Computing systems Consumer & Commercial ?IT Services ?Adapting to internet age Fig. Distribution Channels HP-Compaq optical fusion: Why? ?Financial Benefits ?$ 2.5 billion cost savings ?Business Synergies ?complementary businesses ?Gain Compaqs market share in the server market ?Economies of scale HP-Compaq Merger: Why not? ?Higher exposure to unreal PC business ?The exchange ratio of 0.6325 is at a noble premium of about 18% ?HP has a higher(prenominal) expected annual growth rate (-10.4%) as compared to Compaq (21%) qualify Ratio Analysis 1As of august 31,2001 220 day average 360 day average 4 cxx day average 5360 trading day average 61 yr average 73 month high 83 month low If you want to get a extensive essay, order it on our website: Orderessay

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