Digital shareholders OK Compaq acquisition deal to close

Digital shareholders OK Compaq acquisition deal to close

Digital shareholders voted overwhelmingly in favour of the company's acquisition by Compaq at a special meeting held last week, according to a Digital spokesperson.

The new management team will not include Digital CEO, chairman and president Robert Palmer, who announced his resignation late last week.

About 700 investors, mainly individual shareholders who were not Digital employees, attended the meeting in person. Of the 109 million shares actively participating in the voting, 107 million were in favour of the acquisition, according to the Digital spokesman.

The US Federal Trade Commission (FTC) ended its review of the acquisition and the waiting period under the Hart-Scott-Rodino Act has expired, so everything is set for the close of the deal, which was announced in January and is valued at $US9.6 billion.

As a result of the vote, Compaq will issue approximately $US4.5 billion in cash and approximately 141 million shares of Compaq stock, based on an exchange rate of $US30 in cash and 0.945 shares of Compaq stock for each common share of Digital, Compaq said in a statement.

The merged company plans to compete head-on with IBM and Hewlett-Packard in offering users the gamut of computing products and services - from PCs up to mainframes. The new company will style itself as a complete solutions provider for users. It now has the resources of Digital sales and service troops, the range of its hardware, as well as the high-end computing line of Tandem, which Compaq bought last year, Pfeiffer has said.

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