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HP strikes deal to buy EDS for $12.6 bln

Tue May 13, 2008 7:42am EDT

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NEW YORK, May 13 (Reuters) - Hewlett-Packard Co (HPQ.N) will buy Electronic Data Systems Corp EDS.N for $25.00 per share, the two companies said on Tuesday, or about $12.6 billion to better compete against IBM (IBM.N).

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The companies said the deal had an enterprise value, which includes debt, of $13.9 billion.

The announcement was widely expected after a source briefed on the matter said on Monday that HP was in advanced talks with EDS with the plan of announcing a deal by close of Tuesday.

The deal is expected to close in the second half of 2008, the companies said. Their collective services businesses had annual revenues of more than $38 billion and 210,000 employees, doing business in more than 80 countries, they said. (Reporting by Tiffany Wu; Editing by Derek Caney)

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