$1.4bn to merge HP

Hewlett-Packard has admitted that will cost the company $1.4bn in special charges if it completes its proposed $22bn acquisition of Compaq.

Bob Wayman, HP's chief financial officer, told a meeting with securitiesanalysts in New York that it would cost $450m-$700m in restructuring charges and an additional $450m-$700m in purchase accounting and goodwill costs.

The final price tag is estimated to be between $800m and $1.2bn.

Wayman added that the $1.2bn figure was "quite conservative" and believedthat the actual costs would likely be nearer the $800 million mark.

Wayman pointed out that US job cuts cost less than those in Europe, and the company had still not yet announced which HP and Compaq employees would be among the 15,000 that will be let go subsequent to a merger.

Most of the restructuring charges will be booked in fiscal 2002, whichends in October, he said.