HP-Compaq merger on bubble

PALO ALTO, CALIFORNIA - Pension fund managers for California teachers and Ohio state workers said they will vote against the $21 billion acquisition of Compaq Computer Corp. by Hewlett-Packard Co., but two large HP investors backed the deal. <br> <br> With HP&#39;s stockholders scheduled to vote Tuesday, more than 21 percent of the shares appear lined up against the deal, and more than 8 percent is publicly in the company&#39;s camp. <br> <br> Still, many analysts have said the company has a 50-50 chance of winning shareholder approval, despite the opposition of HP board member Walter Hewlett.<br> <br> The latest opponents to speak out were the California State Teachers Retirement System, which had 0.30 percent of HP stock as of Dec. 31, and the Ohio Public Employees Retirement System, which had 0.21 percent. <br> <br> Later in the day, Banc One Investment Advisors said it would vote its 0.26 percent stake for the deal, and the Ohio teachers&#39; pension fund pledged to vote yes with its 0.18 percent stake, HP spokeswoman Rebeca Robboy said. <br> <br> HP shares fell 71 cents, 3.5 percent, to $19.40 on the New York Stock Exchange, while Compaq stock lost 30 cents, 2.7 percent, to $10.70.

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