No ruling on HP merger at Delaware court Monday

WILMINGTON: The Delaware business court judge deciding the fate of

Hewlett-Packard Co.'s planned $18 billion takeover of Compaq Computer Corp. did

not file a ruling on Monday, a court official said.

Representatives of Hewlett-Packard and Walter Hewlett, the founding family

scion who sued to overturn what he calls a tainted shareholder vote on the deal,

both said they were not aware of a decision.

Analysts and investors expected a ruling in the closely watched case Monday

or Tuesday.

The registry official at the Delaware Chancery Court said Judge William

Chandler, who presided over a three-day trial last week and received closing

briefs late on Friday, had not given the office his decision by the end of the

business day.

Hewlett's team released its closing trial brief late on Monday, telling

Chandler that HP chief executive Carly Fiorina and her team had left a trail of

"small details" that showed "clear -- and devastating --

patterns".

"The vote was tainted by material misrepresentations and omissions as

well as a misuse of corporate patronage and should be set aside by this

Court," lawyers wrote, alleging that HP had covered up information that

merger planning was behind schedule and had "bought or coerced" votes

from shareholder Deutsche Bank Asset Management.

HP in its final brief argued that internal projections quoted by Hewlett's

team were not comparable with official forecasts and asked Chandler to clear

Fiorina's name and "force Walter Hewlett and his team to face reality. They

lost."

Chandler could throw out the vote, as Hewlett requested, dismiss Hewlett's

challenge or throw out 17 million contested ballots which Hewlett alleges

Deutsche Bank Asset Management cast in favor of the merger under pressure from

HP management.

Throwing out the Deutsche ballots might not change the outcome of the vote,

however, since HP claims a 45 million vote margin of victory in a preliminary

tally by the independent company hired to make the count. Hewlett is examining

that count.

Shares of HP closed up a penny at $16.97, while Compaq rose about 1.5 per

cent, or 15 cents, to $10.30 on the New York Stock Exchange, reflecting

expectations that the merger would close.

Since merger plans were announced on Sept. 3, shares of HP have

underperformed the computer hardware sector, dropping more than 26 per cent,

compared with a drop of about 16 per cent each for International Business

Machines Corp. and Compaq and a 5 per cent drop for the American Stock Exchange

Computer Hardware Index .

HP says it would be a stronger competitor to IBM and become a leader in a

consolidating market for technology and related services through the merger.

Hewlett argued HP would be dragged more deeply into the lower-margin personal

computer business by acquiring No. 2 PC maker Compaq.