Hp 's Value Destroying Acquisition Deal

“Bill Hewlett & Dave Packard founded Hewlett Packard (HP) in a one-car garage in 1939. Its first product was an audio oscillator which was used as an electronic test instrument by sound engineers. Its first customer was Walt Disney Studios. For the first twenty years, HP’s products were predominantly electronic test & measuring instruments for engineers & scientist. Since then HP has added computers, calculators, medical electronic equipment, instrumentation for chemical analysis & solid-state components. In 1980 sales had grown at a compounded rate of 23% over the last decade whereas net profits had compounded at 27%. Such a growth was consequently followed by the increasing number of employees which rose to 57,000 across the world. There are currently twenty manufacturing locations across United States & eight others around the world.” (Beer, Michael, & Richard, 1982)

I will never see the day when there is not yet room for improvement. Through time, HP's focus on innovation had brought the world products such as the handheld calculator and the inkjet printer. In 1992, the company continued to invest heavily in technology, spending $1.6 billion or 10% of revenue on research and development. The high levels of investment have paid off. For three straight years, over half of HP's orders had been for products introduced within the last two years.

HP entered into an agreement with Compaq Computer Corporation in September 2001. In this definitive agreement, HP is going to purchase all of Compaq’s common shares outstanding, and pay a total price of 0.6325 shares of its common stock for each share of Compaq’s common stock.

HP did many things correctly when addressing the challenges for disruptive change. For instance, they organized a smaller team of “hungry” individuals from marketing, manufacturing, and research and development that moved the project away from the core group essentially acting as a small startup business. The smaller group was motivated to establish itself and prove their product was worthy of funding and upper management support. They also differentiated themselves by choosing team members that were uninterested in maintaining status in the company mainstream way of thinking. HP allowed a lot of leeway to the Kitty Hawk team in making decisions and providing financial backing to the project’s

Revolt is a rise away from constitution authority, Several slaves in the plantation revolted in the 1800s, but the Denmark vessey and Nat turner organized slave revolt is one of the most excellently and brilliant planned. Both men prepared strategically to override the institution of slavery. They were never contented with it, cause it made them sad. The revolts took time, courage, bravery and ambition, selfless to even have conceived this idea during that ambition. They were both leader in their community, who strives for greater black opportunities. Their resentment and meticulous planning to execute mass revolt have earned them a place in the history of African American.

All of these technological advances by HP receive the attention of Japan and China where HP expanded in hopes of continuing to invent newer and better technologies in the future. Since the 90’s HP has gone on to invent many other firsts like the first all-in-one device and is the first company to recycle ink cartridges. They have also acquired many smaller companies like Snapfish and Compaq to grow the company to being one of the industry leaders in personal computing. (Hewlett-Packard, 2013).

Yemen G.; Chatterjee S.; &Bougeois III L. (2003). Cisco: Early if not Elegant (A). University of Virginia. Darden Business Publishing.

The case develops around Newell’s CEO Dan Ferguson, the protagonist, as he purchases two key acquisitions, the Calphalon company and the Rubbermaid company. Ferguson feels these acquisitions will assist the company in reaching its goal of a market capitalization of $10 billion, which will allow Newell to control a higher price per earnings multiple. “The company’s plan is to gain access to the capital markets by aggressively adding new products by acquisition”(Montgomery, 2005). The key to this approach was a two part strategy, the acquisition process and guaranteeing company continuity throughout the division to assist the company’s in its market performance. “Executives must balance a company’s growth with its ability to manage the growth”(Raisch and Krogh, 2007).

The Stock market reaction to the acquisition of the PacifiCorp seems to portray the deal as win-win situation since it created value for both companies. The Berkshire Hathaway’s share price closed the day at 2.4%, with a $2.55 billion gain in market value, while the Scottish power Plc only managed a $0.81 billion. For the previous owners, Scottish power included, the price offered shows the gain in value over a few years since the merger with PacifiCorp is significant. As per acquisition accounting, the $2.5billion increase in market value is the company’s increase market value. The share price increase in share price also indicates that it was a good long-term deal.

HCA is a top performing hospital management company that grew to be the largest business of its type in the nation. Its main strategies for growth in the years leading up to 1982 were to acquire and construct new hospitals to expand their portfolio of hospitals. They did this very successfully due to the lack of competition in areas that they owned hospitals in, as well as due to their high standards regarding judging which hospitals operated well enough to be worth HCA’s investment. HCA also had a very reputable chairman and board that was able to convince many non-profit hospitals that may have otherwise resisted selling to people who profit off of sick people.

Her utopian dreams of maintaining discretion of HP’s goals and even her “in-house” attempt at corralling the leaker are seemingly understandable. However her tact and failure to use common ethical business practices will be discussed in detail here.

Valuable experience was gained through the successful acquisition of companies and employees. Acquisition gave Best Buy the ability to determine where expansion should take place, and was the key in distinguishing itself from its competition in the consumer electronic market. The knowledge base of high calibre employees was recognized as another core value in the company’s strategy and success. Best Buy’s global presence provided awareness of any global trends, and access into developing markets to foresee customer needs.

This resulted in low morale and the loss of many experienced, high-ranking executives to HP’s rivals.

Over the past five years, IBM has quietly transformed itself into a "software, solution and services" company. With the transformation from a hardware vendor to a solution provider, it has entered the area of consulting services.

Page eight of the case begins to outline some of the challenges that the HP-Cisco alliance had already faced concerning the sale of joint products. For example, we learn that at HP, Cisco products did not count towards a sales representative’s quota and this resulted in a decline in sales of Cisco equipment by HP sales representatives. Further, if HP or Cisco sales staff had to master not only their parent company product line,