HP finally swallows Autonomy
Looks a bit queasy, starts doing little eggy burps
HP has finally concluded the $10.24bn acquisition of Cambridge-based enterprise search and BI software firm Autonomy.
The £25.50-per-share offer was given the green light by 87 per cent of Autonomy's shareholders last night - a whopping 79 per cent premium on the stock price on 18 August when HP first lodged the bid.
Reaching this stage has not been plain sailing for HP: it was forced to extend the deal's deadline after Autonomy shareholders dragged their feet on the tie up even though a better offer was unthinkable.
Then CEO Leo Apotheker - who backed the bid for Autonomy as part of his vision to transform HP into an enterprise service and software firm - tendered his resignation after the public cock-up over HP's PC biz, WebOS and the Autonomy buy price.
Autonomy CEO Mike Lynch - who got involved in a spat with Oracle boss Larry Ellison recently - will lead HP's expanded software biz unit.
“We are at the dawn of a new era when it is the ‘I’ in IT that is changing, not just the ‘T'," said Lynch in a statement.
HP CEO Meg Whitman, who is still working out the fate of the Personal Systems Group, said gobbling Autonomy will help HP tackle the big data conundrum.
“The exploding growth of unstructured and structured data and unlocking its value is the single largest opportunity for consumers, businesses and governments,” she said. ®
That would be illegal under UK takeover rules.
"a whopping 79 per cent premium"
Recent events show that paying over the odds for acquisitions is a good predictor of imminent failure - Sun buying MySQL, Cobalt, ... and Microsoft buying Skype, Nokia (bought even though no shares changed hands, yet)....
At the very least it looks like desperation.
But, hey, good luck to both parties.
Make or Break?
IMO, this deal will make or break HP. Spending nearly the same cash HP paid for EDS for a company with 25 times less revenue is a risk.
Autonomy = "Next Big Thing" or "The New Google" ?
We will see, but it's a significant risk for HP.
They're going to have to treat the Autonomy staff better than the ex-EDS staff who were confronted with axe waving job cuts from the word go.
Dilbert says it all: