Tomahawk, WI 10/07/2014 (Basicsmedia) – Hewlett-Packard Company (NYSE:HPQ) latest move to split into two comes as a surprise if previous decisions made by the company’s CEO’s are to be considered. Over the years, questions have been raised whether the company would perform better operating as two separate entities. During an interview on CNBC, Endpoint Technologies President and Founder, Roger Kay, questioned whether a change of ownership structure will make any difference especially on the operations of the company.
The announcement has already lifted Hewlett-Packard Company (NYSE:HPQ)’s stock in the market as optimism grows that the move will result in increased shareholder value. The move to split into two according to Kay comes on the heels of increased pressure from the company’s majority shareholders who have been pushing for more shareholder value.
“You may recall when Carly Fiorina bought Compaq she kept saying better together. That was 2001 and finally you came along three years ago when Leo Apotheker said that he thought it would be good to spin them out. […] Meg Whiteman took the helm and said No, better together is right and then she is saying three years later while actually better apart is right,” said Mr. Kay
The split comes in the wake of increased competition in the PC industry an industry that Lenovo is believed to have overtaken Hewlett-Packard Company (NYSE:HPQ) in terms of market share and popularity. Kay also argues that the split is still questionable as both entities have always relied on each other in terms of operations.
“[…] There is some real major un-answered questions here for example. How will they get components costs cheaply?When they are dividing some of their X86 purchases between the server group, which is going to be one company and the client group that is going to be another. How about the Hewlett-Packard Company (NYSE:HPQ) sales force? We will now have two sales people calling on major customers from different companies where formally there was one in charge of the entire account,” said Mr. Kay.