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May 28, 1997


HP pullout from HCL HP denied

Shariq Siddiqui in Bombay

It is now official: Hewlett Packard is not pulling out of HCL HP, the venture with HCL Corporation of India.

The HCL HP scrip has been quoting low and that recently prompted a front-page article in a national newspaper which claimed that the five-year-old marriage of the infotech giants is on the rocks.

The report had claimed that 'Hewlett Packard is selling its stake of 26 per cent to the HCL group. And HCL will continue to distribute HCL HP products and exclusive HP products in India.'

However, the copy had not quoted a single representative of any of the companies involved.

Sharad Talwar, HCL HP's senior marketing manager, was perturbed when he spoke to Rediff On The Net over the phone from New Delhi: "This is really crazy. These are just rumours. Such speculations keep occurring every few months and we have to dispel the rumours each time. Our relationship with HP is sacrosanct and mutually beneficial."

Talwar cannot think of the partnership being broken at this stage, or of any reshuffle of the stakes. He attributes the low quotes on the bourses to the company's relatively poor performance in the last fiscal and the general liquidity crunch.

His hunch is that these rumours keep cropping up when people notice that some of the HP products are not sold by HCL HP. But that is because HCL HP does not sell HP PCs and peripherals like printers. HCL HP is involved in only the servers and workstations business.

He said "HCL HP has benefited a great deal from the partnership with HP. Besides technological and capital inputs, HP has undertaken a lot of intellectual investment in HCL HP in manufacturing, research and development and training."

Hewlett Packard's Programme Manager for Corporate Communications Lakshmi Kanchan also denied the pullout news. "It is incorrect that HP has terminated its relationship with HCL. The joint venture was set up in 1992 for the manufacturing and marketing of HCL and HP products. The two organisations have enjoyed a fruitful and mutually rewarding relationship since then and continue to do so. We find it extremely difficult to respond to these speculations which are not based on any information given out by us or HCL."

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