Merger between HP and Compaq

Mostly most of the company are aiming to maximise the profit of their shareholders, especially in doing so the company should decrease their competitors or hence they can do some acquisition and merger between two big company. HP and Compaq are deciding to merge both of their company having an aim to be the number 1 worldwide position In Servers, PCs and Hand-helds, and Imaging and Printing; Leading Positions In IT Services, Storage, Management Software. These two company are doing the highest deal in computer industry for $24 millions and affected to 160 country and over 140,000 employees all over the world.

While the facts is the both of the company are lossing their share price 21.5% for Hp and 15.7% for compaq in their second day of merger. In addition, in the second week the Hp stock are decreasing againt for over 17% that really make all the business anlyst are wondering about the lost of these merger. Thinking about the goal of these both company in doing their merger such as Hp; by having an economic scale with Compaq that consider as very low in PC indsutry are really a mistake. Both of their competitors are really having an advantage of these merger, for instance Lexmark that rose their share price for over 60% and Dell's the leading PC company are rose for 90%.

These loss are really shrink these two company, from having a very succesful company that having huge market share in Printing and computer industry into loosing almost all of their market share. According to IBS business center research, declining of Hp are mainly because an over-optimism that the company has. without any enough strategy and knowladge in the industry it leads to a failure in the intergration of managment. Despite that there are some differences in target management attitudes and cultured differences that form a non-focused in interal company. The Directors of Hp at that time also can be consider as having a high managerial motivates such a having a high status and emperial building. Most of the study are suggested that it is very hard to succed in having an acquisition and mergers both in shor-term objectives or long-term objectives.