HP v Autonomy explained

Synopsis

The latest chapter in the fight between Hewlett-Packard and UK software company Autonomy unfolds as Autonomy's founder, Mike Lynch, announces plans to report HP to the SEC for false representations to the market. This development follows the revelation of an internal document that sheds light on HP's decision to write down the company by more than $8 billion, with over $5 billion attributed to alleged accounting improprieties. Lynch argues that the document's labeling indicates how HP assessed whether certain transactions met UK or U.S. accounting standards. This ongoing dispute, which has lasted about three years, began when HP acquired Autonomy in August 2011 for $11.1 billion, a move aimed at shifting from low-margin hardware to high-margin software. The acquisition led to significant market reactions, resulting in the firing of former CEO Leo Apotheker and the appointment of Meg Whitman as his successor.