HP waters down Autonomy allegations

The former boss of Autonomy, Mike Lynch claims that HP has failed to provide a detailed calculation of the $8.8 billion write-down in the value of his old company.

Last month, HP stunned investors when it announced it was taking an $8.8 billion charge against the $11.1 billion it had paid for Autonomy it had bought from Lynch a year before. HP claimed that $5 billion of that write-off stemmed from “accounting improprieties, disclosure failures and misrepresentations.”

Lynch told the Guardian that the maker of jolly expensive printer ink is “watering down” the allegations against him. So far he had also not heard from the US Department of Justice, which HP had revealed had opened an investigation into the dispute last month.

Lynch said that the fact that HP had been unable to be specific about its write downs, it amounted to a “material change” in the allegations made.

Neither he nor other former executive directors of Autonomy had contact from any regulatory authority on either side of the Atlantic.

What appears to be happening is that the investigation into Autonomy appeared to be moving backwards and he thinks it is starting to look like there is little proof of what HP believes.

Autonomy was bought by former HP CEO Léo Apotheker as part of his moves to turn HP into a bigger version of SAP. However in SAP the idea was always to sell expensive management software which no-one really knew what it did. In the case of Autonomy, neither did Apotheker. While few thought Autonomy was worth what Apotheker paid for it, the write down was a shock.