It's been
a swift four months from the time Hewlett-Packard Co. announced its $13.9 billion acquisition of Electronic Data Systems Corp. to
Tuesday's close -- an indication that this is a deal both companies are firmly behind. Now, though, the more difficult work of stitching the companies together really begins.
Here's what we know:
Integration team: According to HP chief executive Mark Hurd,
more than 500 EDS and HP employees have been dedicated full-time to integration.
Structure: HP will inject its outsourcing business into EDS, which will run the combined operation. The business will have annual revenues of $38 billion, with 210,000 employees in 80 countries. It will be based in EDS' hometown of Plano, Texas.
Leadership: EDS chief executive Ron Rittenmeyer will run the services business. Joe Eazor, who formerly headed up corporate strategy and business development at EDS, will be senior vice president, transformation.
Mike Koehler, will be SVP of infrastructure technology and business process outsourcing. He held a similar role at EDS.
Layoffs: EDS denied reports in July that
20% of its work force would be laid off. Still HP and EDS were direct competitors, meaning there is likely employee overlap at nearly every level from sales to management to back-office support functions. To keep top talent on board, communication is paramount, and best practice indicates that HR issues be addressed early.
Integration challenge: Keeping customers of both companies informed and comfortable is critical. Customers are never more vulnerable to poaching than following a merger, and you can bet in the hyper-competitive business services sector, rivals large and small are already circling.
The fact that this was a friendly deal will make what could be a complex integration more manageable. But it certainly won't be easy or pain free. How well HP manages the process will be a huge factor in whether
this deal ultimately strengthens HP's position in the lucrative business services segment. -
Suzanne Stevens
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