New Lynch attack on Hewlett Packard valuation
US authorities have begun an inquiry into claims of impropriety at Autonomy
Friday 28 December 2012
Autonomy's founder, Mike Lynch, has launched a fresh attack on Hewlett Packard, accusing the computing giant of changing its story about allegations of accounting impropriety at the British software subsidiary he used to run.
Mr Lynch was prompted to speak out after HP admitted that American authorities have launched an official inquiry into "improprieties, disclosure failures and misrepresentations" surrounding last year's £8.8bn takeover of Autonomy.
HP said in its annual report that the Department of Justice (DoJ) began its investigation last month when the impropriety claims emerged, but the computing giant gave few other new details.
Mr Lynch said: "It is extremely disappointing that HP has again failed to provide a detailed calculation of its $5bn write-down of Autonomy, or publish any explanation of the serious allegations it has made against the former management team.
"Furthermore, it is now less clear how much of the $5bn write-down is in fact being attributed to the alleged accounting issues, and how much to other changes in business performance and earnings projections. This appears to be a material change in HP's allegations.
"Simply put, these allegations are false, and in the absence of further detail we cannot understand what HP believes to be the basis for them."
HP made the claims after a senior member of Autonomy's leadership team came forward, following Mr Lynch's departure this year, alleging "a series of questionable accounting and business practices at Autonomy prior to the acquisition by HP". Mr Lynch has always denied the allegations and complains he has had "no contact" from any regulator.
HP is co-operating with America's Securities and Exchange Commission and Britain's Serious Fraud Office as well as the DoJ.
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