CEO Meg Whitman of Hewlett-Packard (HP), the world's largest personal computer company, yesterday announced it had scrapped plans of selling its PC division.
This reverses her predecessor Leo Apotheker's audacious plan to reengineer the company in the aftermath of its $10.3-billion acquisition of UK-based business information-management software maker Autonomy Corp.
Whitman, hired by HP last month after the company's board fired Apotheker over his plans for the business, said that HP will keep its $40.7 billion PC division since a new evaluation had found the move of selling it too costly.
Separating the PC business would have cost the company an one-time expense of about $1.5 billion, compared to an earlier review that had pegged the cost at around $300 million to $400 million.
"HP objectively evaluated the strategic, financial and operational impact of spinning off" the PC business, said Whitman, and added that keeping the business "is right for customers and partners, right for shareholders and right for employees."
Apotheker had raised the idea in August as part of a sweeping overhaul that clearly stemmed from a financial decision to exit a business that was not generating enough margins. This, despite HP being the world's biggest maker of personal computers with a 17.6-per cent market share, well ahead of its second place rival Dell with 2.5 per cent.