Ex-Autonomy boss Mike Lynch goes nuclear: Claims HP 'misleads' its own shareholders
Fires off attack just hours before stockholder meeting
Mike Lynch, former chief of HP-owned Autonomy, tossed an explosive shareholder letter onto the internet today – just hours before HP's annual investors' meeting in Santa Clara, California.
The scathing missive alleges Hewlett-Packard has been "misleading" its shareholders about the reasons behind the computer giant's $8.8bn write down of its acquisition of Autonomy.
HP, with Léo Apotheker at the helm, gobbled up British software biz Autonomy for a whopping $11.1bn in 2011.
But in November 2012, the US goliath – under Apotheker's successor, Meg Whitman – wrote down the value of the Brit company by an eye-watering $8.8bn after an unnamed whistleblower came forward in May 2012. Having looked over the informant's claims, HP publicly alleged that Autonomy was rife with "accounting improprieties, disclosure failures, and outright misrepresentations."
Since then relations between the enterprise software giant and Mike Lynch, who left Autonomy in May 2012, have been rather fraught: HP insisted it knew nothing of the alleged problems at Autonomy prior to the acquisition; HP shareholders tossed a lawsuit at HP claiming it did; the UK's Serious Fraud Office hurled a probe into Autonomy in May 2013; and Mike Lynch ever so often pops up to stir the hornet's nest and defend his reputation.
This latest salvo from Lynch, once dubbed the British Bill Gates by the Sunday Times, follows a leak to the Financial Times in February this year that claimed HP "knew" about the somewhat idiosyncratic way in which Autonomy booked hardware and reseller sales prior to the acquisition.
Now, Lynch has written a letter asking a variety of questions of HP to coincide with the company's annual shareholder meeting in Santa Clara, California.
"HP has not provided information or evidence to the Autonomy team to substantiate any allegation," he fumed.
"Instead, it has selectively leaked documents and information to the international media, frequently using material taken out of context to create false impressions and smear our reputations.
"Since the last HP shareholder meeting, reports in the media have demonstrated that HP has documents in its possession that show beyond doubt that statements it made on November 20  were misleading. Further, these reports have shown that senior people at HP knew these statements were misleading long before they were made."
Lynch's letter lists a set of questions HP "needs to answer", such as why is has so far declined to show Autonomy's management team the allegations against them, how Autonomy's auditors "missed" certain items, how much HP knew prior to the whistleblower stepping forward, why HP will not release its calculation for the write down, and others.
In response, HP told The Register in a not terribly well worded statement:
As HP has previously reported, it uncovered numerous accounting irregularities at Autonomy prior to its acquisition by HP. HP reported those irregularities to appropriate civil and criminal regulators in the US and UK.
"HP continues to cooperate in ongoing investigations by those regulators," the biz added. ®