HP's chief faces lawsuit over deal for Autonomy
Meg Whitman, chief executive of Hewlett-Packard, has been accused of making false claims over the £7.8billion acquisition of UK software firm Autonomy in a lawsuit brought on behalf of shareholders.
The lawsuit claims that Whitman and other directors of the giant computer company failed in their fiduciary duties to shareholders in acquiring the firm two years ago.
‘Rather than evaluating this important transaction with eyes wide open, HP’s fiduciaries consciously decided to proceed with eyes closed shut, ignoring the warnings of their own professional advisers,’ says the lawsuit.
‘Compounding the problem, after the acquisition closed, HP’s fiduciaries misrepresented the facts to conceal their own failings.’
Whitman announced last year that HP was writing down the value of Autonomy by £5.8billion and said former unspecified members of the Autonomy board had misled investors over the true value of the firm. HP called on the Serious Fraud Office and the US authorities to investigate.
Autonomy’s former chief executive Mike Lynch and the rest of the Autonomy management team said they ‘utterly rejected’ all allegations of impropriety.
The US lawsuit notes that Whitman was ‘directly supervising Autonomy and Mike Lynch and therefore faces personal liability for her failure to manage and supervise’ them. HP’s spokesmen did not return calls at the time of going to press.
Lynch’s spokesman declined to comment.
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