Palo Alto (US) : Hewlett-Packard’s ill-fated acquisition of software maker Autonomy will cost another USD 100 million, as the personal computer and printer maker prepares to settle class-action litigation tied to the 2011 deal.
HP wound up paying a 64 per cent per-share premium for Autonomy as it built up its business software line while retreating from consumer electronics.
The USD 10 billion price tag was 11 times greater than Autonomy’s annual revenue of USD 870 million.
Only a month later, HP fired CEO Leo Apotheker, one of the deal’s biggest backers, as the company struggled to justify disappointing sales and a series of missteps. HP ended up writing off most of the purchase price for Autonomy after alleging that the company had misrepresented its true value during sale negotiations.
Autonomy’s founder has denied the allegations. HP insists that the litigation has no merit, but that it chose to avoid a protracted legal battle. -AP
