Lynch stokes the fire as HP-Autonomy saga continues

Former Autonomy CEO says he's heard nothing from HP, the SFO or the SEC

Mike Lynch, the former CEO of Autonomy, has stoked the fire against HP in his first on-stage interview since the war of words between his former company and its acquirers began.

HP bought Lynch's company Autonomy in October 2011 for $11.1bn (£7bn), but after lacklustre sales Lynch left the firm, sparking a dispute between the companies.

Meg Whitman, HP's CEO, then alleged that an internal "whistle blower" came forward claiming that Autonomy had engaged in dubious accounting practices that had artificially inflated the sales growth of the company's software.

HP has since written down £5bn from Autonomy's value and Whitman vowed to pursue compensation for HP through the civil courts, as well as involving both the Serious Fraud Office (SFO) in the UK and the Securities and Exchange Commission (SEC) enforcement division in the US.

Meanwhile, the Financial Reporting Council (FRC) this month launched an investigation into Autonomy's published financial results for the 18-month period before HP bought out the data governance firm.

Speaking at the London Web Summit today, Lynch said: "I've heard absolutely nothing. We have not heard anything from HP or any of the other bodies; the only thing is the FRC are going to look at it, but otherwise we're just sitting there.

"On my website, I've demanded for HP to back this up. It is amazing that someone can arrange a whole series of interviews and say stuff without backing it up. We knew nothing about it ahead of time – I don't know what they thought was going on."

Lynch, who is believed to have netted around £500m from the company's sale, added that Deloitte is happy with the transaction.

Addressing many tech start-ups at the Summit, Lynch said that as soon as a company is made public its management has no control over whether the company gets sold. In Autonomy's case, the former CEO suggested it was inevitable.

Lynch stokes the fire as HP-Autonomy saga continues

Former Autonomy CEO says he's heard nothing from HP, the SFO or the SEC

"In the UK premiums are worth 20 to 30 per cent and if a technology company comes along it's a 60 per cent premium – then [it is inevitable that] the company gets sold," he said.

Lynch was coy on an emotional attachment with Autonomy and did not want to comment further on HP's decisions.

However, he said former HP CTO Shane Robison was a "true visionary" and important in making the deal possible. Whitman had previously told analysts that Robison and her predecessor Leo Apotheker "led" the deal with Autonomy.

The writedown of Autonomy, Lynch said, was because, when Apotheker left, the firm went from divesting assets to focusing again on hardware.

He also admitted there was a culture clash between the firms.

"The cultures are very different. In Autonomy you have very good programmers; the average age is a lot lower and they are about getting the job done quickly – any large company has longer processes, so putting those two together was always going to be very difficult," Lynch said.

"The most important thing was to retain the talent but, once you've got to a situation where the skilled people are doing conference calls and paper work, it becomes a lot more difficult to retain them," he added.

In January, Computing asked HP's vice president for enterprise services UK, Craig Wilson, if Autonomy was likely to shed any staff and how many had left since HP had wrote down the value of its acquisition.

"We don't share that; we don't share precise stat numbers of any of our divisions, but what I can say is that we continue to have staff at Autonomy," he claimed.