HP's acquisition of EDS for $13.9BN - announced today - will, the company claims, double sales in its services business (already $16.6BN in fiscal 2007), but that didn't stop HP shares tumbling today on the New York Stock exchange. The price of $25 a share represents a 32.5% premium to the EDS closing price of $18.86 on Friday. 

The deal makes HP second to no one but IBM, and is its largest acquisition since acquiring Compaq for $20BN six years ago.

Bloomberg notes that the deal is Chief Executive Officer Mark Hurd's biggest since taking over in 2005.

"When you looked at the maturity and the speed by which we can get to market, this looked extremely attractive to us, particularly on the financial side,'' Hurd is reported by Bloomberg to have said today on a conference call.

"We wouldn't do the deal if we didn't think we had an opportunity to improve the operating profit level that EDS currently has," he added.

"People can have their opinions,'' he continued. "Ours that it's a pretty exciting opportunity. There's nothing great that gets done that doesn't require work.''

• HP Tipped To Buy EDS To Level Playing Field with IBM