Mike Lynch has put together a website as a contact point and to publish views from himself and other former Autonomy management.
There is not much on the site so far, and most of it will be boring to anyone who’s been following the story; eg Lynch’s open letter to HP directors (of November 27); a clip of his interview with Maria Bartiromo on November 20. Read more
Paging Dr Mike Lynch. Your patient seems to be suffering some nasty post-op complications.
From Hewlett-Packard’s fourth-quarter results:
Fourth quarter and full year fiscal 2012 results include a non-cash goodwill and intangible asset impairment charge of $8.8 billion relating to the Autonomy business within the Software segment.
Hewlett-Packard will keep its personal computer division rather than spin it off to shareholders, as its then chief executive, Léo Apotheker, had proposed before he was ousted last month. The FT reports Mr Apotheker’s successor as chief executive, Meg Whitman, said on Thursday that the biggest PC maker by revenue had studied the issue and found that the benefits of separation were outweighed by factors including the price advantages HP enjoys as a large buyer of computer components. “This was first and foremost a math exercise, and a very revealing one,” Ms Whitman said. “I also took into account the distraction that a spin-off would be.” Ms Whitman also said she was not considering whether to reverse another controversial decision by Mr Apotheker, to stop producing tablets and smartphones using HP’s webOS touch-based operating system.
John Paulson, one of the world’s most successful hedge fund managers, has extended losses throughout August to leave his flagship fund down almost two-fifths for the year, the FT says, citing a person familiar with the fund’s performance. His Advantage Plus fund was down 38.7 per cent for the year as of Friday, having lost 22 per cent in the first 19 days of the month. The fund, which follows a strategy of trading around corporate events, was hit by the plunge in the price of Hewlett-Packard after the company announced it would pay $11bn for UK software maker Autonomy and consider a spin out of its PC business. At the end of June, Paulson & Co, which manages about $35bn, held 23.5m shares in HP, according to regulatory filings, a stake then worth $855m. Meanwhile Brevan Howard, the world’s largest macro hedge fund, has made close to $1.5bn over the past three weeks on the back of turmoil in the global markets, also in the FT.
Hewlett Packard bosses have come out fighting in defence of their sharp change in the tech group’s strategy last week, the FT reports. Léo Apotheker, chief executive, will meet shareholders in New York, Boston and London to argue that the company’s bet on business software and its planned exit from personal computers are needed to keep pace with convulsive change in the technology industry. Mr Apotheker told the FT on Sunday the company was “at a pivotal part” of its history, and predicted that HP would regain the $40bn in revenue lost in an anticipated spinoff of the world’s best-selling PC line, while “my assumption is that in the long term we will have better margin profile and a better growth profile”. HP shares have shed 25 per cent of their value since word spread on Thursday that the company would pay $11bn, or more than 10 times sales, for Autonomy, the UK’s biggest software concern. Meanwhile Autonomy chief executive Mike Lynch spoke against protections against foreign takeover for British companies, in The Telegraph.
Autonomy, the UK’s largest software company, is being bought by Hewlett-Packard with an enterprise value of $11bn (£6.7bn) in the latest takeover of a FTSE 100 company by a foreign acquirer, reports the FT. In another big announcement, the FT notes that the double barrelled IT giant said it plans to exit its leading personal computer business, probably through a spin-off to shareholders, as it grapples with a deteriorating economic environment and the overhang from past acquisitions. The WSJ reminds us that we’re now in a “post-PC” world: Steve Jobs told the Apple June developer meeting that “We’re going to demote the PC and the Mac”. The Telegraph profiles the founder of Autonomy, Mike Lynch.
Hewlett-Packard shares on Tuesday fell to their lowest level in almost two years after the US computer giant cut its profit forecast on weak consumer demand and planned changes in its services unit, reports the FT. As it reported 2Q earnings, HP noted that a 23% fall-off in consumer PC revenue would make it more reliant on its forthcoming entrance to the tablet market with the TouchPad. HP reported a 12% rise in PC sales to businesses, which provide the bulk of its revenue, and met overall expectations for the second quarter. But investors sold shares after HP said they should expect profit of “more than $5” a share, instead of the $5.24 previously indicated, and on news of CEO Léo Apotheker’s plan to invest more in pursuit of higher-value services business at the expense of profitability. Lex however says it may well be HP’s execution, “and not its model”, that needs retooling.
Shares in Hewlett-Packard dropped as much as 12% in early trading on Wednesday following the tech giant’s decision to slash revenue forecasts for its current fiscal year by $2bn late the day before, reports the FT. For Léo Apotheker, who took over as CEO four months ago, the sharp sell-off highlighted spreading unease among HP investors that deep cost cuts at the tech conglomerate were starting to hamper revenue growth, and that efforts to rebuild its competitiveness in markets ranging from tablet computers to services would dent future profits. The sell-off came the day after HP reported that revenue for Apotheker’s first complete quarter rose an annual 16% but fell short of its own forecast, as consumer PC sales slumped along with the IT services business. The AP adds that the latest numbers show that HP is benefiting from the changes in its business model — “just not as much as some investors would like”.
Hewlett-Packard has added five new directors to its board, giving majority control of the top-selling tech company to people who weren’t involved in the controversial August ousting of chief executive Mark Hurd, reports the FT. Four serving directors will stand down, while new chief executive Léo Apotheker and chairman Ray Lane, who both joined in September, will be among the eight who remain, HP said on Thursday. The shake-up – which is also occurring in executive ranks – is part of HP’s effort to draw a line under continuing fallout from the departure of Hurd, whose resignation knocked $10bn off the company’s market value. Some shareholders have sued, accusing the previous board of wasting assets in granting Hurd severance that could be worth as much as $40m. The WSJ cites sources saying that the SEC has been investigating circumstances surrounding Hurd’s departure.
Federal regulators are investigating Mark Hurd’s abrupt resignation as chief executive of Hewlett-Packard, including a claim that Hurd shared inside information, reports the WSJ, citing people familiar with the matter. As part of its probe, the SEC is checking whether Hurd passed information about HP’s $13.9bn acquisition of tech consulting company Electronic Data Systems to a former HP event hostess in 2008, before the deal was announced. Hurd has denied having an inappropriate relationship with the HP contractor, Jodie Fisher, whose accusation of sexual harrassment led to his ouster from in August. The NYT adds that the Hurd saga has become Silicon Valley’s own “version of a soap opera”.
Larry Ellison, chief executive officer of Oracle, challenged rivals SAP and Hewlett-Packard on Thursday as he predicted that the US software company would take market share in the most profitable parts of their business next year, reports the FT. His remarks came as Oracle reported an unexpectedly strong bounce in new software sales for its fiscal second-quarter, lifting its shares by 4% to $31.60, their highest in more than eight years. Driving the quarter’s profits was a 21% increase in sales of new software licences to $2bn, beating Oracle’s predictions of 6%-16% growth. The WSJ adds that Oracle said quarterly profit jumped 28% yoy on a 47% surge in revenue, as its bullish attitude eased investor concerns.
Dell’s nifty deal to buy US data storage group, Compellent Technologies, must have restored its faith in the world of M&A, after its dismal ordeal earlier this year in one of the most excruciating bid battles in recent times, the contest with Hewlett-Packard for data storage group 3Par.
As Bloomberg reports, Dell agreed on Monday to buy Compellent for $960m — in a mercifully fairly straightforward deal. Read more
Incoming Hewlett-Packard chairman Ray Lane has issued a number of astonishing public accusations that Mark Hurd “repeatedly lied” to the company’s board during the investigation that led to his ousting, an upgrade in rhetoric that shows HP’s increasing hostility towards long-time partner Oracle, reports the FT. Mr Lane, a prominent venture capitalist who served as president of Oracle a decade ago, made the fresh accusation more than two months after HP forced out the well-regarded Mr Hurd, who more recently signed on as a co-president at Oracle.
Hewlett-Packard on Thursday named Leo Apotheker, a veteran executive and former chief executive at German software company SAP, as its new CEO, following the forced resignation of Mark Hurd in early August, reports the FT. Analysts were surprised at HP’s choice, not least because it chose a man who lasted less than a year as SAP’s sole chief executive before his exit in February after annual sales fell 28%. But the choice of a software veteran suggests, as Apotheker, 57, himself told the FT, that software would be a high priority for HP and that it islikely to continue its aggressive acquisition strategy. Tech blog Digits gives Apotheker mixed reviews.
That didn’t last long. Hewlett-Packard has abandoned its legal attempt to prevent former chief executive Mark Hurd from moving to Oracle only a fortnight after filing papers, the NYT reports. Hurd has waived rights over restricted stock units and the two companies said he would protect HP’s confidential information, adds the FT — and Oracle and HP even confirmed that they would renew their strategic partnership into the bargain. HP can count this one as a small victory, Reuters says — it was never going to win in court, but at least it’s clawed back some money for shareholders.
Hewlett-Packard is looking within to find its next chief executive, the WSJ reports — though the company won’t be announcing a pick in the next few days. Three executives stand out, according to the paper’s sources — Todd Bradley, HP’s personal-computers boss, Ann Livermore, who leads its server business, and Dave Donatelli — who led the company’s bidding war with Dell for 3Par. Bradley appears to be in the lead for now, having gained support on HP’s board. HP’s lawsuit to prevent its ditched former chief executive Mark Hurd from joining Oracle continues.
Hewlett-Packard’s board is nearing a decision on a successor to Mark Hurd as chief executive officer, and is leaning toward picking an internal candidate, reports Bloomberg, citing a person familiar with the matter. The short list includes Vyomesh Joshi, who runs HP’s printer business; Todd Bradley, head of the personal-computer division; Dave Donatelli, who runs the storage and server unit; Tom Hogan, executive vice president of enterprise sales and marketing; and Ann Livermore, executive vice president of the enterprise business, said the person.
Ho hum. Another day, another Hewlett-Packard bid…
The acquisitive US tech giant is nearing a deal to buy US security software maker ArcSight, fresh from its $2.35bn victory in a bidding war against Dell for data storage company 3Par, reports the FT. Read more
Hewlett-Packard is nearing a deal to buy US security software maker ArcSight, fresh from its victory in a bidding war with Dell for data storage company 3Par, reports the FT. HP is expected to pay about $1.5bn for ArcSight and a deal could be announced within days. ArcSight’s shares have jumped on takeover speculation and closed on Friday at $35.10, for a market cap of $1.21bn. DealBook notes that despite the contentious departure of its former CEO Mark Hurd, HP again has “shown little timidity about paying up”, while the WSJ - which first reported the ArcSight deal - notes that HP last month announced acquisitions of software makers Fortify Software and Stratavia for undisclosed terms.
Mark Hurd is expected to earn $11m in his new role at Oracle, putting him back among the tech industry’s highest-paid executives, the FT reports — though he may not like having a boss (Oracle’s Larry Ellison) above him for once, the WSJ says. But Hurd’s move is more than a executive suite soap opera, the FT adds – the industry as a whole is moving from an era of close alliances to deepening fractures on which chunks of the market to carve out. Oracle is shoving its way into the server and storage sector — while Hurd’s former employers HP are making a defensive bid in networking.
Mark Hurd could make nearly $11m a year in his new position of co-president at Oracle, putting him in the tech industry’s top pay ranks after his forced resignation as head of Hewlett-Packard last month, reports the FT. News of the pay deal followed a legal challenge from HP that some legal analysts saw as an attempt to recover some of the millions that the computer maker paid out to its former chief. HP’s board has been criticised over its agreement to pay Hurd a severance package valued at $35m-$40m. FT Alphaville meanwhile notes similarities between Hurd and newly-promoted bankers Barclays’ Bob Diamond and HSBC’s Stephen Green.
It’s getting ugly in executive-recruitment land. “HP sues to block Hurd’s move to Oracle”, reads one FT headline on Wednesday, while another proclaims: “Outrage over Diamond promotion“, while the BBC’s Robert Peston asks, “Has the casino swallowed Barclays?”
That’s just a tiny taste of the furore that the elevation of the two — er, rather controversial — chief executives has whipped up on both sides of the Atlantic. Read more
Hewlett-Packard has sued to block Mark Hurd, its former chief executive, from joining Oracle, intensifying the saga that has transfixed Silicon Valley, reports the FT. The lawsuit, which seeks an injunction preventing Hurd from taking up the post of co-president of Oracle, was filed on Tuesday in a California court, a day after Hurd’s appointment. Hurd was forced out by HP’s board in August for mis-stating expenses linked to a relationship with a former HP marketing consultant. Meanwhile, DealJournal looks at Oracle’s stock price move and asks whether Hurd is worth $6.8bn.
Larry Ellison has put his money where his mouth is, writes the NYT. Oracle’s chief executive has secured the appointment of Mark Hurd, former chief of Hewlett-Packard, to a co-president role that might give Oracle the edge over HP in the hardware business. Mr Hurd also targeted IBM in his statement on the move, reports Reuters. But there are still questions over where Oracle goes next in terms of R&D and acquisitions in the Hurd-hardware era, ZDNet’s Irregular Enterprise notes. It’s all turning into a nightmare for HP, however, VentureBeat argues.
Mark Hurd has been appointed co-president of US software giant Oracle only a month after being forced out as head of Hewlett-Packard over breaches of code of conduct, reports the FT. Hurd’s rapid return reflects strong support from some in Silicon Valley, including Oracle’s co-founder and CEO Larry Ellison, despite his ouster by HP’s board after sexual harrassment allegations and censure for “inappropriate” expenses reports. Oracle on Monday named Hurd as one of its two presidents and a board director, giving him a key supporting role to Ellison who, as the NYT puts it, has “put his money where his controversial mouth is”.
Oracle’s board is set to vote within days to bring Mark Hurd to the company in a top role, marking a swift image rehabilitation for the ousted Hewlett-Packard chief executive, reports the FT. Hurd is unlikely to win the title of chief executive, held since 1977 by Larry Ellison, Oracle’s founder and chairman and 25% stake owner. But almost any position would represent a coup for Hurd after HP’s board forced him to quit over his handling of expenses following sexual harassment charges by a female consultant. The WSJ notes that if successful, Hurd would join a company that has been ‘increasingly stepping on HP’s turf’.
Hewlett-Packard won the battle for US data storage company 3Par on Thursday after rival PC maker Dell balked at raising its offer yet again, the FT reports. 3Par accepted HP’s latest bid of $33 a share, or about $2.4bn, beating Dell’s revised bid of $32 a share, and paid Dell a $72m fee to break their merger agreement. The contest, starting before 3Par accepted a Dell offer at $18 last month, highlights intensifying rivalry between the two top US PC makers as they move into new areas. FTAlphaville asks, what’s so special about 3Par?, while BreakingViews wonders whether Dell’s shareholders are on tranquilisers.
Dell said on Sunday it was assessing its bid for 3Par after the US data storage company’s board late on Friday said Hewlett-Packard’s $2bn offer was a “superior proposal”, reports Reuters. After HP upped its offer for the third time in a week, 3Par notified Dell of its intention to terminate their earlier merger agreement. Dell has three business days to match HP’s offer under its original agreement with 3Par. A Dell spokesman said the company would decide “in the best interest” of customers and shareholders. But, notes FT Alphaville, one wonders what’s so special about 3Par anyway?
So, a rather baffling bid battle rages on – with yet another counter-offer from HP (see update below) after we reported on Friday that Dell looked to have won out in the most frenzied bidding war we’ve seen in recent times. That came after the US computer giant matched Hewlett-Packard’s (yet again) revised $1.8bn offer for US data storage company 3Par, Reuters reports, on Friday.
And like any good tech company, 3Par within hours of accepting Dell’s offer, had the news on its corporate website. Read more
Was it really only two months ago that we were seeing headlines like this:“M&A activity slack in spite of renewed appetite“, and reading columns like this, by the FT’s M&A reporter Lina Saigol, (our emphasis):
Dealmakers are born optimists, but even by their own standards there has been little to be cheerful about so far in 2010…. Read more