Hewlett-Packard Buying EDS, Once GM OwnedBy Michelle Krebs May 13, 2008
Wall Street is abuzz with the news that Hewlett-Packard is buying Electronic Data Systems for $12.6 billion.
Old-timers in the auto industry may remember that General Motors, with the late and controversial Roger Smith at the helm, purchased EDS, founded by H. Ross Perot, in 1984 for $2.6 billion. GM's purchase of EDS along with Hughes Aircraft and a host of small high-tech companies was part of Smith's vision to create the high-tech 21st Century car company.
It didn't work out that way. Perot, who served on the GM board, complained all too publicly of how hidebound and slow to act GM was, prompting GM to buy out Perot, who went on to form another company and run for U.S. president, and spin off EDS. GM remains one of EDS's largest customers; EDS employees occupy two towers of downtown Detroit's Renaissance Center, purchased last week by GM and used as its corporate headquarters.