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Wednesday, 14 November, 2001, 16:04 GMT
Hewlett-Packard battles for Compaq
graphic
Wall Street analysts have been lukewarm about the merger since it was announced
The boss of Hewlett-Packard said she remains convinced her firm's $22bn merger with Compaq Computer will go ahead.

The merger is being opposed by members of both the Hewlett and Packard families whose votes are needed to seal the deal.

HP chief executive Carly Fiorina, whose own future is thought to hinge on completing the merger, said the approval process is "not yet even half-way through".

Ms Fiorina's comments come as Hewlett-Packard unveiled lower sales and profits for the three months to the end of October.

Shares in the company jumped nearly 13% on the news as analysts - many of whom are sceptical about the Compaq deal - were impressed by HP's efforts to cut costs.

Still talking

HP's management has been meeting with the David and Lucile Packard Foundation, whose more than 10% shareholding has become crucial given the opposition of some family members.

Ms Fiorina said the meetings will continue and added the Foundation's decision may not be made until January next year.

"We remain convinced this merger will occur", she said.

Hewlett-Packard CEO Carly Fiorina
CEO Fiorina has had to endure a tumbling tech market and much criticism

Shipments of personal computers have dropped this year for the first time in more than a decade.

HP's net profits fell steeply to $97m after restructuring costs, down from net profits of $922m on the same three months of last year.

Profits on HP's continuing operations dipped to $361m from $841m.

But earnings per share on this basis were comfortably ahead of Wall Street forecasts, at 19 cents against a consensus of 8 cents.

Sales slipped to $10.9bn from $13.3bn year-earlier.

See also:

07 Nov 01 | Business
Hewlett-Packard's merger woes mount
06 Nov 01 | Business
Hewlett family to vote down merger
04 Sep 01 | Business
Profile: HP's Carly Fiorina
06 Sep 01 | Business
Tough sell for PC giants merger
13 Feb 01 | Business
Hewlett-Packard re-invents itself
05 Sep 01 | Business
Jobs slashed in biggest PC merger
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