I’ve been seeing a stream of tweets pass my twitter feed today calling question to HP’s purchase of Autonomy. At the time of the acquisition, there was all sorts of buzz that one of HP’s reasons for buying into the ECM/DAM space was to mold itself after Big Blue and shed some of it’s consumer-centric divisions. Is this (another) nail in the coffin for HP?
Oh, the Drama!
According to CEO Meg Whitman, someone had been cooking the books before the deal was inked.
Reuters is saying that:
HP alleged… Autonomy’s former management inflated revenue and gross margins. It said Autonomy executives mischaracterized revenue from low-end hardware sales as software sales and booked some licensing deals with partners as revenue, even though no customer bought the product.
On USA Today’s site Matt Krantz reports HP told it’s investors they’re going to “write-down” some $8 plus billion in earnings because of the ordeal and goes one to say:
The size and scope of the charge is staggering, given that the $8.8 billion financial hit is nearly as large as the $10 billion HP paid for the company. But the company, in a release, said: “We remain 100% committed to Autonomy and its industry-leading technology.”
I do love a good corporate drama, and this has the makings of a tantalizing soap opera.