HP just can never catch a break.
Appearing in the news the whole of 2012 for a series of reasons ranging from outgoing CEOs, untimely announcements that caused a rash of panic and resignations (at least in this region), the latest mishap to hit the beleaguered global ICT solutions provider is something that has been stewing in their financial books… they just didn’t catch it when they were supposed to.
Last year, HP acquired the UK-based Autonomy during ex-CEO Leo Apotheker’s very brief tenure. Sources close to the matter say that Apotheker had immediately gone on an acquisitions hunt, approaching companies like Amdocs, Tibco and Comverse, before he settled on Autonomy, a big data pioneer, to help HP “transform” itself into a software-focused company, the course that Apotheker, a former SAP veteran, had set for HP at that time.
Over a year after the US$11.1billion deal closed and after having announced solutions with Autonomy technologies integrated into a range of product offerings, it is finally coming to light that HP had paid too much for Autonomy. HP officials are saying they have been deceived.
As a result, HP has had to write off US$8.8 billion and are being sued by investors eager to recoup losses. HP themselves are on a suing spree, and on their list are HP’s board of directors, officers, former execs, and last but not least, the firm which audited Autonomy before the deal closed, Deloitte Touche Tohmatsu. Another audit firm, KPMG was also named by current HP CEO Meg Whitman, as having overseen Deloitte’s auditing, but KPMG is saying their service in that particular matter had been ‘limited.”
That’s a lot of finger-pointing all around.
Funnily, while HP was price haggling with Autonomy, internal HP staff from relevant departments and numbering in the hundreds, had been poring over Autonomy’s books and doing all the necessary to ensure it was a clean deal, for one extensive month.
IT BYTES BACK! says: Looks like due diligence wasn’t given the diligence it was due.
