Here’s How Autonomy May Foil H-P Yet Again
Hewlett-Packard’s (NYSE:HPQ) allegations against the enterprise software company Autonomy have taken many twists and turns, and the latest event in the PC-maker’s ongoing probe have unfolded in a manner no less bizarre than the investigation’s history would suggest. The United Kingdom’s anti-fraud office said that it may have a conflict of interest in its examination of H-P’s claim that Autonomy engaged in accounting irregularities before the acquisition was made in 2011.
When former H-P Chief Executive Officer Leo Apotheker first joined the company, he was given the task of moving HP in a new direction as the company’s traditional computer business was slowing. Apotheker looked to acquisitions as a means to transform the company, and Autonomy — a company that was a success in the field of “big data” — was eventually chosen to fulfill that role.
But just over a year after the $11-billion acquisition was completed, H-P was complaining that it had been mislead by Autonomy. “In hindsight, we shouldn’t have done the Autonomy deal at such a high price,” the company’s Chairman Ray Lane told Reuters in November. “We were lied to and as a result, we got it wrong.” Wrong may be an understatement. The deal caused H-P to take a $5 billion accounting charge in the fiscal fourth quarter related to “serious accounting improprieties” at Autonomy before the purchase was made. This caused shares to hit a decade low at the end of last November…