HP shareholders are deciding whether to back Chief Executive Carly Fiorina's plan to buy Compaq Computer Corp. in the largest computer merger ever, or whether side with HP founding families who see the deal as a $25 billion mistake.
The vote comes after a contentious battle for shareholder support between Mr Fiorina, who has staked her career on the merger, and Walter Hewlett, a dissident board member and son of a company founder who has argued stridently against the deal.
After months of being deluged by newspaper advertisements, proxy materials, and press releases, shareholders said there was little left to do but watch and wait.
"We'll just be watching the headlines. Regardless, we don't expect to make any investment moves after the vote," said David Katz, chief investment officer at Matrix Asset Advisors, a small HP and Compaq shareholder who has criticized the deal.
"In terms of how this plays out, it's way too close to call. Unless there's a surprise victory by a meaningful margin we don't expect the winner to be declared today. In fact, we think both sides might declare they are winners," Katz said.
The shareholders meeting convenes at 16:00 GMT, at the Flint Center, a symphony hall in Cupertino, California, near HP headquarters, although the official result may be weeks away.
Hours before the meeting opened, merger opponents led by Walter Hewlett had gained slightly more public support, with about 24 per cent of shareholders against the merger -including many HP employees' pension plan shares -- compared with about 20 per cent seen for management.
That includes about 10 per cent of shareholders from index funds bound to follow the advice of Institutional Shareholder Services, an advisory firm in favor of the deal, now worth nearly $21 billion in HP stock.
While HP remained quiet before the meeting began, Walter Hewlett asked shareholders once more to side with him, saying in a statement that the interests of shareholders were aligned more closely with the Hewlett and Packard families, who are large shareholders, than with HP's management.
Walter Hewlett, who says Mr Fiorina should leave, wants to focus the company on its printer operation and maintains that the merger instead would bloat its low-profit personal computer operation and distract employees, giving rivals an edge.
HP's stock price, meanwhile, has fallen 17 per cent since management announced the deal on Sept. 3, while Compaq has dropped 27 per cent, an indication investors doubt the deal will be pulled off, since Compaq shares should have risen toward the price implied by the merger's terms if it seemed likely.
IBM shares have risen 12 per cent in the same period.