EfluxMedia

Hewlett-Packard announced Tuesday that it will acquire Electronic Data System Corporation at a price of $25 a share. The transaction estimated at $13.9 billion is the second biggest in its recent history after the company bought Compaq for $20 billion in 2002. The boards of both companies have approved the transaction, but the E.D.S. shareholders must also give the go. The deal will probably close in the second half of this year.

E.D.S. will remain a separate business group and its chairman and CEO will continue to run the company.

The transaction continues the line of acquisitions that HP has done in recent years as part of its competition with IBM. HP expects that the acquisition will double the amount of $16.6 billion in revenue it had last year and will diminish the gap that has been created between HP and IBM, the industry’s leader in the field of computer consulting and outsourcing.

The deal might be a dangerous one for HP, the world’s largest PC manufacturer, since E.D.S. is a company with a totally different culture than its own and integrating it could prove to be a difficult task. One of the benefits of the transaction could be the possibility that HP will sell more of it computers to the companies that E.D.S. is consulting.

The I.T. services market is expected to grow in the next five years so companies are expected to show more and more interest in this domain where IBM, Accenture and HP-E.D.S. hold the lead.