The founder of Autonomy has stepped up pressure on Hewlett-Packard, issuing an open letter to the board and demanding an explanation of allegations levelled against him during an $8.8 billion (€6.8 billion) writedown of the UK software firm’s value last week.
In the letter, Mike Lynch said HP had yet to contact him directly with allegations of corporate misconduct and financial irregularities that formed the basis of the writedown and have since triggered an FBI inquiry.
“I am writing today to ask you, the board of HP, for immediate and specific explanations for the allegations HP is making,” he said.
HP acquired Autonomy for $11 billion in 2011. In writing down the value of the deal, HP chief executive Meg Whitman last week told journalists information provided by a member of Autonomy’s team in May – after Mr Lynch was fired – had prompted an internal inquiry that revealed “disclosure failures and outright misrepresentations” before the acquisition.
These included using hardware sold at a loss to inflate revenue figures. Mr Lynch has admitted to selling small amounts of hardware at a loss but denies any allegations of false or misleading accounting.
Ms Whitman said HP had passed the information to the US Securities and Exchange Commission’s enforcement division and the Serious Fraud Office in the UK. – (Copyright The Financial Times Limited 2012)
