The Hindu Business Line : HP to acquire Electronic Data Systems for about $13.9 bn

NEW YORK: Technology firm Hewlett-Packard said on Tuesday that it would acquire technology services firm Electronic Data Systems for an estimated $13.9 billion.

In this regard, both companies have signed a definitive agreement, under which HP would buy Electronic Data Systems at a price of $25 per share, valuing the company at about $13.9 billion.

The transaction is expected to close in the second half of 2008, HP said in a statement. The deal is expected to more than double HP's services revenue, which amounted to $16.6 billion dollars in fiscal 2007.

According to the statement, HP intends to establish a new business group, to be branded EDS and headquartered at Electronic Data Systems' existing executive offices in Plano, Texas.

After the deal, HP plans that EDS would continue to be led by Electronic Data Systems Chairman, President and Chief Executive Officer Mr Ronald A Rittenmeyer. He would join HP's executive council and report to Mr Mark Hurd, HP's chairman and chief execut ive officer, the statement added.

The boards of HP and Electronic Data Systems have unanimously approved the terms of the transaction. The companies' collective services businesses, as on the end of each company's 2007 fiscal year, had annual revenues of more than $38 billion and 2,10,00 0 employees. The two had operations in more than 80 countries. - PTI

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