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| Autonomy founder squares up to Hewlett-Packard on day of AGM | Autonomy founder squares up to Hewlett-Packard on day of AGM |
| (6 months later) | |
| The founder of Autonomy, Mike Lynch, has confronted the US computer firm Hewlett-Packard on the day of its annual shareholder meeting, saying the British software firm's former management team "refuse to be a scapegoat for HP's own failings". | The founder of Autonomy, Mike Lynch, has confronted the US computer firm Hewlett-Packard on the day of its annual shareholder meeting, saying the British software firm's former management team "refuse to be a scapegoat for HP's own failings". |
| In a tirade that marked the latest round of hostilities between the two camps, Lynch accused HP of acting "in an aggressive and unusual manner" over recent months. HP bought Autonomy for $11bn (£7bn) in 2011, only to announce a related $8.8bn writedown last November, citing false accounting. | In a tirade that marked the latest round of hostilities between the two camps, Lynch accused HP of acting "in an aggressive and unusual manner" over recent months. HP bought Autonomy for $11bn (£7bn) in 2011, only to announce a related $8.8bn writedown last November, citing false accounting. |
| HP investors are preparing to rebuke the company's board over the disastrous acquisition, with shareholder advisers recommending a vote against the re-election of the chairman, Ray Lane, and other directors whom they criticise for "inconsistent strategies" and a "dismal stock performance". | HP investors are preparing to rebuke the company's board over the disastrous acquisition, with shareholder advisers recommending a vote against the re-election of the chairman, Ray Lane, and other directors whom they criticise for "inconsistent strategies" and a "dismal stock performance". |
| In an open letter published on Wednesday on the website Lynch set up to defend his reputation, the entrepreneur, worth an estimated £480m thanks to the sale of his company, called on HP to answer a series of questions at its shareholder meeting. | In an open letter published on Wednesday on the website Lynch set up to defend his reputation, the entrepreneur, worth an estimated £480m thanks to the sale of his company, called on HP to answer a series of questions at its shareholder meeting. |
| HP alleged in November there were "serious accounting improprieties, disclosure failures and outright misrepresentations" in Autonomy's business, but has provided no other detail. Lynch has rejected the allegations, saying the problem with the Autonomy acquisition lies in the "mismanagement" of the business by HP. | HP alleged in November there were "serious accounting improprieties, disclosure failures and outright misrepresentations" in Autonomy's business, but has provided no other detail. Lynch has rejected the allegations, saying the problem with the Autonomy acquisition lies in the "mismanagement" of the business by HP. |
| Lynch is demanding to see a copy of a report by the accountants PwC on which HP's accusations are based, and to be told the findings of a committee which he claims was appointed by HP to investigate the circumstances behind the acquisition. | Lynch is demanding to see a copy of a report by the accountants PwC on which HP's accusations are based, and to be told the findings of a committee which he claims was appointed by HP to investigate the circumstances behind the acquisition. |
| He also asked whether HP had approached the UK Takeover Panel, which supervises the acquisition of publicly listed companies, in an attempt to rescind its offer to buy Autonomy before the deal was voted through by shareholders. Lynch writes: "If so, what was the reason it gave and why was this material change of view not communicated to shareholders?" | He also asked whether HP had approached the UK Takeover Panel, which supervises the acquisition of publicly listed companies, in an attempt to rescind its offer to buy Autonomy before the deal was voted through by shareholders. Lynch writes: "If so, what was the reason it gave and why was this material change of view not communicated to shareholders?" |
| Autonomy's book-keeping is now under scrutiny on both sides of the Atlantic. The UK's Serious Fraud Office and the accountancy watchdog, the Financial Reporting Council, have announced investigations, as has the Department of Justice in the United States. The work of Deloitte, Autonomy's auditor until its resignation in December 2012, will also be assessed. | Autonomy's book-keeping is now under scrutiny on both sides of the Atlantic. The UK's Serious Fraud Office and the accountancy watchdog, the Financial Reporting Council, have announced investigations, as has the Department of Justice in the United States. The work of Deloitte, Autonomy's auditor until its resignation in December 2012, will also be assessed. |
| In a statement HP said: "We have handed over our information of serious misrepresentations in Autonomy's accounting to the proper authorities. We continue to co-operate and provide requested information to the relevant authorities on an ongoing basis." | In a statement HP said: "We have handed over our information of serious misrepresentations in Autonomy's accounting to the proper authorities. We continue to co-operate and provide requested information to the relevant authorities on an ongoing basis." |
| Among those recommending votes against the re-election of HP directors is John Liu, the head of New York City's employee pension funds. Liu wants the two longest serving board members, John Hammergren and Kennedy Thompson, voted off "because of their failure to protect investors from costly, misguided acquisitions". He believes they should share the blame for the earlier ill-fated purchases of the IT groups EDS and Palm, and for the hasty hiring of Léo Apotheker, whose short-lived tenure as chief executive ended shortly after the Autonomy acquisition that he engineered. | Among those recommending votes against the re-election of HP directors is John Liu, the head of New York City's employee pension funds. Liu wants the two longest serving board members, John Hammergren and Kennedy Thompson, voted off "because of their failure to protect investors from costly, misguided acquisitions". He believes they should share the blame for the earlier ill-fated purchases of the IT groups EDS and Palm, and for the hasty hiring of Léo Apotheker, whose short-lived tenure as chief executive ended shortly after the Autonomy acquisition that he engineered. |
| Institutional Shareholder Services, which advises stockholders on voting, recommends that investors vote against Lane, Hammergren and Thompson. Glass Lewis & Co is also advising against the return of the venture-capital investor Marc Andreessen and the lead independent director, Rajiv Gupta. | Institutional Shareholder Services, which advises stockholders on voting, recommends that investors vote against Lane, Hammergren and Thompson. Glass Lewis & Co is also advising against the return of the venture-capital investor Marc Andreessen and the lead independent director, Rajiv Gupta. |
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