HP confirms government probe of Autonomy purchase

The United States Department of Justice is looking intoHewlett-Packard Co.’s $10.3 billion acquisition of search company Autonomy,according to the technology hardware manufacturer’s regulatory filing with the Security and Exchange Commission.

HP had earlier reported that it had to write off $5 billion due to its controversial 2011 acquisition of Autonomy. The company alleges thatAutonomy inflated its value though “serious accounting improprieties, disclosurefailures and outright misrepresentation.”

Meg Whitman, HP CEO

Apart from the SEC, HP also provided the United Kingdom’sSerious Fraud Office information about the alleged fraud, according to a reportfrom Computerworld.

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Autonomy’s founder Mike Lynch however continues to contestHP’s allegations.

“We continue to reject these allegations in the strongestterms,” Lynch wrote in a letter publishedlast Friday. “Autonomy’s financial accounts were properly maintained inaccordance with applicable regulations, fully audited by Deloitte, andavailable to HP during the due diligence process.”

“Simply put, these allegations are false, and in the absenceof further detail we cannot understand what HP believes to be the basis forthem,” he wrote.

In an earlier interview HP CEO Meg Whitman said her company’srelied on the audited financial statements when agreeing on the purchase price.She said HP also had its own outside auditors look at the financial statementsbefore approving the deal.

However, she claims, different things came to light afterAutonomy officials left the company following the closure of the deal.

Readthe whole story here.



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