(Adds analyst comment, details from statement, share move)

NEW YORK, May 13 (Reuters) - Hewlett-Packard Co (HPQ.N: Quote, Profile, Research) has struck a deal to buy Electronic Data Systems Corp (EDS.N: Quote, Profile, Research) for $12.6 billion, seeking to boost its technology services business to better compete against market leader IBM (IBM.N: Quote, Profile, Research).

The companies said the deal values EDS at $25.00 per share, a 33 percent premium to its closing price on Friday, before reports of merger talks sent the shares soaring on Monday.

"They are getting EDS, which I think is a pretty good company, for a pretty beaten-down stock price," said Matt McCall, president of Penn Financial Group.

"We're going to start seeing more, I believe, of these strategic deals where it's not private equity coming, but it's big companies -- such as Microsoft (MSFT.O: Quote, Profile, Research) trying to go after Yahoo (YHOO.O: Quote, Profile, Research) -- who have cash on their books and see beaten-down stock prices," he said. "And just like investors,

(they) should be taking advantage of that."

The companies said the deal was worth $13.9 billion including debt.

The acquisition, expected to close in the second half of 2008, will more than double HP's services revenue, which amounted to $16.6 billion in fiscal 2007. the companies said. Combined, their services businesses have annual revenue of more than $38 billion and 210,000 employees and do business in more than 80 countries, the companies said.