Autonomy founder turns up the heat on HP over fraud allegations

The founder of Autonomy, has intensified pressure on Hewlett Packard for disclosure of details about the allegations of fraud it made against the UK technology company last year when it wrote off $8.8 billion (£5.8 billion) in its buyout of the business.

In 2011 Hewlett Packard acquired the Cambridge-based software company Autonomyin a deal worth $10.3 billion.  

Autonomy founder Mike Lynch, wrote in an open letter to HP shareholders that the US firm had acted in an "aggressive and unusual manner throughout this episode".

Lynch left the business in May last year, months ahead of the US firm making allegations against the company.

He pointed out that the problem with HP's over $10-billion buyout of Autonomy in 2011 lay in "the mismanagement of that business by HP under its ownership, making it impossible for Autonomy to deliver on HP's expectations".

Leo Apotheker was HP chief when it bought Cambridge-based Autonomy, though he was replaced, soon afterwards by Meg Whitman, the former eBay boss who returned to the tech world after a failed bid at the governorship of California. She has since then been attempting to turn around the business.

In his letter, addressed to shareholders gathering for HP 's annual meeting in California last night, Lynch took aim at HP over the claims of fraud levelled against Autonomy when HP announced the write-down in November last year.

"Autonomy's accounts were fully audited by Deloitte throughout the period in question and Deloitte has confirmed that it conducted its audit work in full compliance with regulation and professional standards," he wrote. "We refuse to be a scapegoat for HP's own failings."

Meanwhile, HP said that it had established a committee for investigating the $10.3-billion (£6.8 billion) acquisition of UK software maker Autonomy, as it sought to address the issue at its annual shareholder meeting.

Three board directors would sit on the committee that would also examine HP's decision to pay $13.9 billion in 2009 for software company EDS. HP had been forced to write down the value of both acquisitions by billions of dollars, contributing to a sharp decline in the shares of one of the world's biggest PC makers.

After its acquisition of Autonomy in the summer of 2011, HP stunned Wall Street last November with accusations of the UK company's "accounting improprieties" that it claimed forced it to overpay.