The case will now focus on Autonomy’s founders and executives.
Economic Times reported on the settlement of the case, which began back in November 2012 when HP claimed Autonomy “misled” it and its shareholders about the state of its finances, with HP shareholders suing the OEM for loss of money as a consequence of poor quarterly results after the acquisition.
Sources close to the case stated that the settlement “is likely to be signed” today, with the settlement seeing lawyers for the shareholders agree “to drop all claims” against HP’s current and former executives, including current CEO Meg Whitman and previous CEO Leo Apotheker, in addition to board members and advisers.
However Autonomy, whose former CEO and co-founder Michael Lynch reported he was “in the dark” about the case in March 2013, will now be targeted by the shareholders’ lawyers as well as HP itself, and will be faced with action alongside Autonomy’s former CFO Sushovan Hussain, though “the precise nature of such claims and when HP might file them could not be learned”.
HP had revealed that in acquiring Autonomy, it had been forced to take an $8.8 billion (€6.4 billion) “impairment charge” in November 2012, with over $5 billion (€3.6 billion) of this said by HP to be due to “serious accounting improprieties, misrepresentation and disclosure failures”, with Economic Times noting that the acquisition became “one of the most disastrous […] by a major company in recent years”.
Lynch continues to deny the allegations, blaming HP “for its own failure to manage Autonomy after the acquisition”, with other sources stating that HP believes “Autonomy’s results and prospects were made to look much better than they were”.