Features

SAN JOSE — Two Hewlett-Packard Co. directors warned Monday that many board members and some of the company’s top executives might quit if shareholders reject the $22.6 billion purchase of Compaq Computer Corp. next week. 

If the acquisition fails, the eight HP board members who support the deal would have “personal conflicts” and “an important decision to make,” Phil Condit, the chief executive and chairman of Boeing Co., said in a conference call with analysts and reporters. 

“Each member of the management team will also have a personal decision to make,” he said. 

However, fellow board member Sam Ginn, the retired chairman of Vodafone AirTouch, said that if the deal dies and directors step down, they would not leave HP in chaos — nor put the boardroom solely in the hands of dissenting director Walter Hewlett. 

“I won’t walk away and pout,” Ginn said. “I will make sure if I decide to leave that I have a proper replacement before I walk out the door.” 

This is not the first time HP directors have threatened to leave if the acquisition is blocked. Chairwoman and chief executive Carly Fiorina also would be widely expected to move on if the deal crashes. 

But the subject is being renewed at a critical time, with HP’s March 19 shareholder vote appearing too close to call and many investors possibly on the fence. 

Walter Hewlett has said any implication that large numbers of directors and managers would leave is part of an attempt by HP to scare investors. He said Monday that Ginn and Condit actually affirmed his position that HP would remain stable. 

Ginn and Condit said they believe the integration of Compaq is being planned well and that they are confident the deal will dramatically improve the end-to-end technology “solutions” Hewlett-Packard can offer corporate customers. 

But while many big customers have offered glowing praise about the deal, others seem more circumspect. A Merrill Lynch survey of U.S. and European companies found that nearly half of those with HP or Compaq equipment oppose the deal. About one-quarter were in favor. 

Condit chalked that up to “familiarity and change,” and the usual ways suppliers have to win their customers over every day. He said both companies’ profitable recent quarters indicate that customers aren’t fleeing. 

He also said the deal is supported by a majority of HP’s 20 largest shareholders, but he would not offer specifics. 

Shares of Palo Alto-based HP rose 39 cents, nearly 2 percent, to $20.98 on the New York Stock Exchange, where shares of Houston-based Compaq lost 53 cents, or 4.5 percent, to $11.27. 

That widened the gap between Compaq’s stock price and the price HP would pay for the shares — indicating an increasing belief on Wall Street that the deal will be rejected. 

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On the Net: 

Pro-merger site: http://www.votethehpway.com 

Anti-merger site: http://www.votenohpcompaq.com