Mike Lynch is lynched by the HP board
Mike Lynch CEO of HP’s recently acquired Autonomy, is no more. He was ousted in unceremonial fashion just like so many before him, by a HP board which seems set on cannibalism as a trait.
Shareholders need to ask two serious questions of Meg Whitman. Firstly, does the HP board really understand what Leo Apotheker, Meg’s ousted predecessor, actually bought and secondly can HP stop the wanton destruction of shareholder value in Autonomy that seems inevitable now that the brain-child and driving force of its creation has been executed?
What did HP buy? Leo’s name seems forever to be associated with failure, yet he presided over the acquiring of what should be the jewel in the lacklustre crown of HP. We recall Leo saying in March 2011 that “HP has lost its soul” perhaps it has lost its ‘common sense’ too. Lynch’s lynching follows the loss of 20% of Autonomy’s staff including the entire management team early in the take-on of the company. This acquisition, although slightly over-priced, was a world-beating security software coupe playing directly to position HP to dominate Homeland Security solutions in the US and the equivalents in NATO and UK plc for years to come, including breathing new life and purpose into securing and retaining HP’s huge multi £Billion DII project for another term with the UK MoD. Where to now?
Cultural incompatibility is a key factor in destroying corporate value in mergers and acquisitions, but perhaps in this case Meg Whitman and the HP board have failed to understand the world beating software’s potential. If this is so then clients, analysts and shareholders need to understand precisely how HP, as a hardware provider, intends to not only embrace and exploit software in general but what is to be salvaged from Autonomy in particular.
One thing that is certain is that Autonomy 2 will rise from the ashes and in all probability, be led by a re-energised Mike Lynch and its original management team.