Putnam Investments said its will vote its shares in favor of the proposed merger of Hewlett
Packard Co. and Compaq Computer Corp.
, a hopeful sign for
advocates of the $22 billion deal.
“We believe the merger enhances the combined companies’ strategic and competitive positions and offers financial benefits to shareholders,” the Boston mutual fund
giant said in a statement. “Therefore we believe long term shareholder value will be enhanced as a result of the combination.”
As of December 31, 2001, through its retail mutual funds and in institutional accounts, Putnam held a total of 46.2 million shares in Hewlett-Packard and 68.9 million
shares of Compaq, good for 2.5 percent and 4 percent ownership stakes, respectively.
The announcement was unsurprising; in January, Compaq’s CEO Michael Capellas signaled that the fund firm would back the deal, although the
announcement makes it official.
A final vote on the proposed merger is scheduled for Wednesday. Earlier this week, two other institutional investors, Bank of America and Wells Fargo Bank, said sided with
dissident board member Walter Hewlett is opposing the deal.
And this morning the California State Teachers’ Retirement System, one of the largest U.S. pension funds, said will vote “no.” Its reasons included concerns about integrating the two large companies and exposure to the unprofitable PC market.
Compaq is based in Houston and HP is in Palo Alto, Calif. However, there is keen interest in the outcome of the merger in New England. Compaq has a significant
presence in the region because of its earlier purchase of Maynard, Mass.-based Digital Equipment Co.
Shares of CPQ and HPW were each off about 2 percent at midday.