The ongoing dispute over HP’s colossal 2011 deal to buy British tech firm Autonomy for $11bn is set to rumble on, with news that the former company will sue the UK arm of accounting giant Deloitte.
The news comes after two years of public disputes over the deal, which saw HP buy the UK firm for what was seen as a vastly inflated price. In 2012, HP announced it would be writing off almost half of the $11bn spent on Autonomy, as well as axing the British chief of the company Mike Lynch.
HP accused the management of Autonomy of overstating the company’s value
HP accused the management of Autonomy of overstating the company’s value. As a result of the dispute, HP shareholders also sued the firm for mismanagement of the deal.
Now HP is targeting Deloitte UK, the accountancy firm that audited Autonomy at the time. HP said in a statement: ‘We will continue to work to have the derivative actions settled or dismissed and to hold the former executives of Autonomy as well as Autonomy’s auditor, Deloitte UK, responsible for the wrongdoing that occurred.’
However, both Deloitte UK and Autonomy’s former leaders deny allegations of malpractice. The accountancy firm responded: ‘Deloitte was not engaged by HP, or by Autonomy, to provide any due diligence in relation to the acquisition of Autonomy. Deloitte UK was auditor to Autonomy at the time of its acquisition by HP. Deloitte UK conducted its audit work in full compliance with regulation and professional standards.’
The case is set to continue, with investigations by the US Securities and Exchange Commission, the FBI and the UK’s Serious Fraud Office, to decide whether Autonomy’s board inflated the price of the deal.
