EU Continues Compaq Talks With HP

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Hewlett-Packard continued to talk with the European Commission on Thursday about its bid to purchase Compaq but no final decision had been reached, people familiar with the situation said.

The sources declined to characterize the situation ahead of a January 31 deadline. The Commission must either approve the deal by that deadline or decide to subject it to a four-month in-depth investigation.

During the initial one-month investigation a company and the Commission on occasions agree that they have discovered competitive problems with a deal. In such cases the company may offer remedies.

In this case the deadline for offering such remedies has passed without any such measures being offered.

Regulatory clearance is not the only hurdle the deal faces. The shareholder vote on what would be the largest merger in personal computer history is due in March, with the outcome far from certain.

HP Chief Executive Carly Fiorina has had a tough battle selling the merger, announced on September 4, after members of both the Hewlett and Packard founding families said in December they planned to vote against the deal.

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