http://www.computerworld.com/storyba/0,4125,NAV47_STO69909,00.html
Investment advisory firm's relationship to HP questioned
By LINDA ROSENCRANCE
(April 05, 2002)
An investment adviser has accused Hewlett-Packard Co. of misleading
shareholders by failing to disclose its business relationship with a major
financial backer of Institutional Shareholder Services Inc. ISS is an
influential institutional investor advisory firm that supported HP's merger
with Compaq Computer Corp.
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In an SEC filing, Warburg is listed as being a general partner in ISS. And
three of Warburg Pincus' partners, Mark Colodny, Pat Hackett and Sidney
Lapidus, sit on the eight-member ISS board of directors, according to SEC
filings.
Warburg and HP are both investors in several ventures, including:
Santa Clara, Calif.-based software company WebGain Inc. Last year, in the
second round of funding, HP invested $10 million in WebGain. In a previous
round of funding, Warburg Pincus invested $62.5 million, according to
IPO.com, which tracks the financing activity of emerging growth companies
across the public and private equity markets.
San Jose-based application server software maker BEA Systems Inc. Warburg
Pincus is an investor in the company and over the past three years, HP has
invested $100 million in BEA to jointly develop a range of application
integration and component software aimed at helping users quickly build and
deploy electronic-commerce applications (see story).
Dublin-based Eontec, a developer of Java-based banking software. Last year ,
Warburg Pincus invested $25 million in Eontec. HP and BEA are Eontec's
partners.
The relationship troubled analysts and business ethicists who said any
connections between HP and a major financial backer of ISS should have been
disclosed to shareholders.
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