'Happy to throw Leo under the bus', Meg Whitman told HP after Autonomy buyout
Then-CEO also told Mike Lynch's people to 'grow up'
Autonomy Trial Meg Whitman told London's High Court today she regretted saying she was "happy to throw Leo [Apotheker] under the bus in a tit-for-tat" during the fallout over HP's purchase of Autonomy.
Robert Miles QC, barrister for ex-Autonomy boss Mike Lynch, showed Whitman - HP's former CEO who replaced Apotheker - a copy of a December 2012 email sent by an HP PR officer Henry Gomez, at the time HP's chief comms officer. That email referred to statements made by Apotheker, who blamed HP's board for letting him go ahead with the US tech titan's buyout of Autonomy.
Apotheker was unhappy that HP was publicly rowing back on its purchase of the British software company because it cast him in a bad light.
"Your comment," said Miles to Whitman, "was 'happy to throw Leo under the bus in a tit-for-tat'."
The black-suited American exec, sitting in the witness box, subtly winced.
"When I felt he was trying to throw the board under the bus, it was in a moment of anger and disappointment here and I shouldn't have said it," she replied. Miles was quick out of the blocks to follow this up, responding: "That's exactly what you did to Dr Lynch at this time."
"That's absolutely not the case," replied Whitman.
Earlier in court this morning, Whitman, clad in an executive power suit, a pearl necklace and wearing her trademark smile, was almost cordial with Miles as he took her back through the timeline of events in early 2011 before HP acquired Autonomy. At the time Whitman was a HP board member, later that year rising to CEO and replacing Apotheker, who had been tossed overboard for his part in driving the Autonomy buyout.
Whitman went to some lengths to defend Mark Hurd, the late-2000s CEO of HP, saying "the stock price of HP reached an all time high" under his leadership, though the company had to fight off a shareholder lawsuit over his $53m severance package.
Hurd was fired after HP found he had fiddled his expenses while trying to impress a former Playboy hostess.
What does synergies actually mean?
A heated argument over the term synergies erupted as Miles took Whitman through one of HP's internal documents from mid-2011 predicting how big its revenues could be if it bought Autonomy.
According to Meg:
Synergies means, 'What do you get when you put Autonomy together with HP?' If Autonomy was on track to go from 100 to 200 and with HP was going from 100 to 250, the synergies is the 50. It is not adding pre-existing software businesses and putting them together.
Miles put it to Whitman that the synergies HP expected from the Autonomy buyout were around $4bn, on top of the basic addition of Autonomy's revenues to HP's. When she and Miles disagreed about whether that was what the document said, Whitman commented: "I think maybe you and I have a semantic difference and this is a super important semantic difference," going on to explain her view again.
After hearing Whitman out, Miles commented: "I don't think there's any difference between us in fact."
HP's former chief exec disagreed, breezily looking round at HP's legal team as she said: "Why don't we deal with this during the break?"
Rattled as his witness began taking charge, Miles fell back on legal procedure to regain his footing: "I don't want to lecture you on this but during the break you are not to discuss the case with anyone."
The billionaire businesswoman, worth $3.8bn according to a recent Forbes rich list, beamed back: "Purdah, it's called purdah!"
Whitman also revealed that HP thought Oracle was its main contender in a potential bidding war for Autonomy, as well as explaining its intended strategy for Autonomy post-buyout.
Hill suggested to her that HP's plan was "to create a platform to provide on-demand access for customers, providing solutions for archiving back-up components, search and discovery."
I think yes, but I might phrase it slightly differently. Autonomy would agree to create that platform since they had the bulk of the assets. I think the platform would have been created by Autonomy with help from HP and there would have been a joint go-to-market for this platform.
She also confirmed Lynch's memory of a conference call with Autonomy's managers, not long after the buyout, in which she told them "The fun is over and it's time for Autonomy to grow up'."
Mike Lynch’s co-defendant, Sushovan Hussain, is no longer going to testify in his own defence. The case continues, as it is predicted to do until at least January 2020. ®
Whitman admitted that she and then-CFO Cathie Lesjak subjected Hewlett Packard's senior leadership to country and western star Kenny Rogers' song "The Gambler" – but denies she did it more than once. The song, regarded across the Atlantic as a classic of the uniquely American genre, is about a drunk, penniless gambler who dispenses unsolicited advice to a traveller on an overnight train.
If you want to experience the full HP management treatment circa early 2012, shut yourself in a boardroom and start playing this. For added realism, print out Whitman and Lesjak's faces and stick them on the opposite wall. You score nul points if you fail to keep a straight face.
Responding to claims made by one-time Autonomy chief exec Mike Lynch that this was a feature of her executive leadership style, Whitman said in her witness statement that the music was "a lighthearted way of getting across a message we wished to deliver."