The dispute over Hewlett-Packard's $19 billion (€21.5 billion) bid for Compaq Computer took a further twist yesterday when HP acknowledged two federal agencies were investigating whether it had improperly secured shareholder votes to win approval for the merger.
The computer and printer maker said the Securities and Exchange Commission's (SEC's) San Francisco office had "informally" requested information about HP's "relationships and communications" with Deutsche Bank. Separately, the US attorney's office for the southern district of New York issued a subpoena on April 10th for documents related to votes cast by Deutsche Bank and Northern Trust.
The revelations, made by HP yesterday in a SEC filing, are the first hint of possible criminal wrongdoing regarding the March 19th HP shareholder vote, which it claims it won by a slim margin.
The request for information is a sign of increased scrutiny by regulators since the collapse of Enron and the end of the stock market bubble. However, the probe opens up a new front for the SEC, which has mostly been examining accounting practices and financial disclosure.
With some people close to the companies saying the margin of victory for the merger was as little as half a percentage point, the votes cast by Deutsche Bank could have been decisive. Mr Walter Hewlett, the dissident director who has fought to derail the deal, has asked a Delaware court to throw out the results of the vote.
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