NEW YORK (CNN/Money) - The merger of Hewlett-Packard Co. and Compaq Computer Corp. received the key backing of Putnam Investments Wednesday.

Boston-based Putnam, one of the nation's largest money management firms, holds 46.2 million shares, or about 2.4 percent of HP's 1.94 billion shares outstanding. Putnam also holds 68.9 million shares, or about 4 percent, of outstanding Compaq shares.

"We believe the merger enhances the combined companies' strategic and competitive positions and offers financial benefits to shareholders," Putnam said in a statement. "Therefore we believe long term shareholder value will be enhanced as a result of the combination."

Putnam's support of the merger is a significant milestone for the transaction.

HP's fourth largest shareholder, Bank of America Capital Management Inc. said it will vote the shares it controls against the merger. BofA holds a total of 53.4 million shares, or 2.8 percent, of HP, but controls only a small portion, 6.4 million.

Individual clients control the rest, or 47 million shares, spokesman Joe Fazzino said.

"Our impact is a lot smaller than people realize," Fazzino said.

California Public Employees' Retirement System, or CalPERS, and Wells Fargo are also set to vote against Hewlett-Packard's (HP: Research, Estimates) takeover of Compaq (CPQ: Research, Estimates).

Calpers owns 7.6 million HP shares and 6.5 million of Compaq, making up a small portion of the outstanding shares.

The merger has faced considerable opposition since it was announced last September. Shareholders of Hewlett-Packard are set to vote on the merger March 19, and Compaq will vote a day later.

Last week, a key proxy advisory firm, Institutional Shareholder Services, backed the merger. ISS's clients control a 23-percent block of HP shares.

HP board member Phil Condit, the chairman of aerospace titan Boeing Co., said Monday that he believes 20 of HP's largest shareholders favor the deal. Brandes Investment Partners, citing integration risks and a potential clash of corporate cultures, has said it plans to vote its 25 million HP shares against the merger. Brandes 25 million shares represent a little more than 1 percent of Hewlett's total shares outstanding.