Compaq Acquires NetWorth in Landmark Expansion

Strategic Insights -

Compaq Computer Corporation made a significant move into the internetworking products market by acquiring NetWorth, Inc. in a deal worth $42 per share. The acquisition, which was announced on December 11, 1995, saw a substantial number of shares tendered, with approximately 91% of outstanding shares being purchased by Compaq. The merger is expected to be completed before the end of 1995, marking a significant milestone in Compaq's transition from a PC company to a full-service computer company.

Key Takeaways:

  • Compaq acquired NetWorth, Inc. for $42 per share in a tender offer that closed on December 8, 1995.
  • 7,232,236 shares, or approximately 91% of outstanding shares, were tendered in response to the offer.
  • The merger will be completed before the end of 1995, with Compaq-Dallas, Inc. serving as the wholly-owned subsidiary for the integration of NetWorth.
  • Any shares of NetWorth common stock not tendered and purchased will be converted into the right to receive $42 per share in cash.
  • Compaq will focus on integrating NetWorth into its internetworking products business, enhancing its portfolio of Fast Ethernet hubs, switches, and related products.
  • The acquisition of NetWorth and Thomas-Conrad represents Compaq's rapid fulfillment of its promise to deliver a complete line of internetworking products.
  • Compaq reported 1994 worldwide sales of $10.9 billion and is the world's largest supplier of personal computers.

Statistics:

  • 7,232,236 shares were tendered in response to the tender offer.
  • Approximately 91% of outstanding shares were purchased by Compaq.
  • Compaq will spend $42 per share to acquire NetWorth.
  • The merger will be completed before December 31, 1995.
  • Compaq reported 1994 worldwide sales of $10.9 billion.

Sources:

  • Business Wire, "Compaq Announces Successful Tender Offer for NetWorth, Inc.", December 11, 1995.
  • Compaq Computer Corporation, "Compaq Offers to Acquire NetWorth, Inc. for $42 per Share in Cash", December 1995 (no date specified).
  • Compaq Computer Corporation, "Company Background", Undated (no date specified).