HP and Compaq keep the faith

What does Oracle boss have to do with this takeover?

What does Oracle boss have to do with this takeover?

HP's takeover of Compaq is still on course despite the battering both companies' shares have taken since the deal was announced. HP shares have fallen 22 per cent and Compaq has suffered a 14 per cent drop. Carly Fiorina said she expected the markets to react negatively to the news, "but to be honest it was a bit more negative initially than we thought. We expected some volatility but not as much as this" she told the Financial Times. Fiorina insisted both companies' boards remained committed to the deal. She said only shareholders could stop the deal going through. She added that she was most concerned at the possibility of European regulators objecting to the merger. It has also emerged that the deal came about as a result of action by Larry Ellison, Oracle chief executive. Ellison urged Fiorina to look at Compaq's server clustering technology. That led Fiorina to discuss a licensing agreement with Compaq. This conversation developed into full takeover talks.