HP stock falls on news of acquisition fraud Around Town, posted by Editor, Palo Alto Online, on Nov 21, 2012 at 11:27 am
Palo Alto-based HP said Tuesday that "accounting improprieties, misrepresentations and disclosure failures" caused it to massively overpay for the British software company Autonomy Inc. last year, which it bought for nearly $11 billion.
Read the full story here Web Link posted Wednesday, November 21, 2012, 9:44 AM
Posted by resident, a resident of the College Terrace neighborhood, on Nov 21, 2012 at 11:27 am
HP has screwed up a lot in the last few years. There is a lot of blame to spread around on this one, though. HP reportedly hired Deloitte, one of the world's biggest auditing companies, to evaluate Autonomy before the purchase. I expect a big lawsuit between the 2 companies and maybe HP can get some of their money back.
Posted by resident, a resident of the College Terrace neighborhood, on Nov 21, 2012 at 1:53 pm
Reports in various business newspapers today are saying that HP's explanation is either a hoax or at most a gross exaggeration to coverup poor management and poor business decisions by HP. Yes, HP did lose a ton of money on this deal, but they could have figured out ahead of time that the deal stunk.
Further, the real reason for HP's stock price plunge is a poor quarterly earnings report. Autonomy may be just a smoke screen for the mass media, but professional bankers and investors aren't buying it.
Posted by Silly, a resident of the Embarcadero Oaks/Leland neighborhood, on Nov 21, 2012 at 9:58 pm
There were 15 big-name advisers on the deal -- auditors, law firms and bankers -- on which $100,000,000 was spent to check out the deal. HP decided to ignore its own CFO and Larry Ellison who said the Autonomy was way over-valued and NOW they're demanding an FBI, SEC and Serious Frauds investigation??
The best comment was along the lines of "They bought a Rolls-Royce, drove it around for more than a year and only then did they realize they'd gotten a Yugo?"
Don't forget they wrote down EDS last quarter. What's left next time?
I'm SO glad Meg is only screwing up HP and not the whole state of CA.