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HPE considers selling select software assets

Autonomy, Mercury Interactive and Vertica all on the block, say reports

Hewlett Packard Enterprise (HPE) is considering selling off some of the assets in its HPE Software division in a bid to slim down the company and reduce debts.

Those assets include Autonomy, the Cambridge-based search and analytics technology company it acquired in 2011, which is now the subject of legal action against its CEO and founder Mike Lynch, as well as chief financial officer Sushovan Hussain over allegations of accounting fraud, claims that Lynch and Hussain deny.

HPE had paid $10.3bn (£8bn) for Autonomy when only months earlier software giant Oracle had reportedly turned down a proposal to acquire the company for half that amount, claiming that it was overvalued.

Other companies that may be put up for sale include Mercury Interactive, which makes application management software; and analytics platform Vertica Systems. HPE acquired Mercury Interactive for $4.5bn in 2006, while Vertica was picked up for $350m in 2011.

The software divestiture claims were made in a report on the Bloomberg newswire, citing the inevitable "people familiar with the matter" who "asked not to be identified because the matter is private". HPE has declined to comment on the report.

HPE is struggling with more or less flat revenues, but software is floundering in particular, down in the three months to the end of April by 13 per cent compared with the same quarter a year earlier. HPE claims that much of that decline is accounted for by divestitures that it has already made, as well as currency fluctuations. At $774m, furthermore, software sales are dwarfed by enterprise hardware and services.

With technology asset prices at an all-time high, the sales will help the company to reduce its indebtedness while focusing the company more closely on high-end hardware and computer services.

President and CEO Meg Whitman's intention is that HPE should target market sectors in which it either is, or can reasonably aspire to be, number one or number two. The first annual report of the new company, following the demerger of the HP Inc PCs and printers business, indicated that HPE would focus software on big data analytics and applications, enterprise security, application testing and delivery management and IT operations management solutions.

HPE considers selling select software assets

Autonomy, Mercury Interactive and Vertica all on the block, say reports

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