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Hewlett-Packard to split into two companies | |
(about 5 hours later) | |
Technology giant Hewlett-Packard, known as HP, is to split itself into two separate companies. | |
The US firm will separate its better-performing computer and printer business from its corporate hardware and services operations. | The US firm will separate its better-performing computer and printer business from its corporate hardware and services operations. |
Shareholders will be given a stake in both businesses. | |
The split is part of a radical restructuring plan, which has already resulted in tens of thousands of job cuts in recent years. | |
The firm is now in the fourth year of its five-year turnaround plan, aimed at helping the firm adapt to the new era of mobile and online computing. | |
Current chief executive Meg Whitman, who has the job of reviving the fortunes of the 75-year-old firm, will head the new spin-off, Hewlett Packard Enterprise. | |
This will house the corporate hardware and services operations. | |
She will also be chairman of HP's printing and PC business, HP Inc, which last quarter accounted for about half its revenue and profit. | |
Ms Whitman said the split would give both firms the "flexibility they need to adapt quickly to market and customer dynamics". | |
"We can [now] more aggressively go after the opportunities created by a rapidly changing market," she added. | |
HP said it expected the division to be complete by the end of the 2015 financial year. | |
Business pressures | Business pressures |
The division of HP's businesses comes at a time when other large tech firms are being urged to break up. | The division of HP's businesses comes at a time when other large tech firms are being urged to break up. |
Last week, online auction site eBay announced it was splitting off its payments system PayPal into a separate company. | Last week, online auction site eBay announced it was splitting off its payments system PayPal into a separate company. |
HP has been under pressure from newer rivals such as Chinese firm Lenovo, which overtook HP as the world's largest PC maker in 2012. Third-ranked US rival Dell was taken private last year. | HP has been under pressure from newer rivals such as Chinese firm Lenovo, which overtook HP as the world's largest PC maker in 2012. Third-ranked US rival Dell was taken private last year. |
Founded by Bill Hewlett and Dave Packard in 1939, HP helped usher in the PC revolution and now has more than 300,000 employees globally. | Founded by Bill Hewlett and Dave Packard in 1939, HP helped usher in the PC revolution and now has more than 300,000 employees globally. |