HP set­tles law­suit over Au­ton­omy

Los Angeles Times - - BUSINESS BEAT - By Tracey Lien tracey.lien@la­times.com Twit­ter: @traceylien

SAN FRAN­CISCO — Hewlett-Packard Co.’s ill-fated $10-bil­lion ac­qui­si­tion of Bri­tish soft­ware maker Au­ton­omy Corp. is go­ing to cost it even more money af­ter it re­cently de­cided to set­tle a class-ac­tion law­suit stem­ming from the deal.

The class ac­tion was brought on be­half of in­vestors who were hurt af­ter the Palo Alto com­pany ac­quired Au­ton­omy for $10 bil­lion in 2011 be­fore writ­ing down $8.8 bil­lion re­lated to the deal a year later.

HP had said at the time of the write-down that it had been duped into over­pay­ing for Au­ton­omy. The $10-bil­lion price tag was 11 times greater than Au­ton­omy’s an­nual rev­enue of $870 mil­lion.

The com­pany an­nounced Tues­day that it will pay $100 mil­lion into a set­tle­ment fund that will go to share­hold­ers who bought HP shares from Aug. 19, 2011, to Nov. 20, 2012.

The com­pany said in a state­ment that even though it be­lieves the law­suit has no merit, “it is de­sir­able and ben­e­fi­cial to HP and its share­hold­ers to set­tle the case as fur­ther lit­i­ga­tion would be bur­den­some and pro­tracted.”

The com­pany and its cur­rent and for­mer ex­ec­u­tives and di­rec­tors will be re­leased from any Au­ton­omy-re­lated se­cu­ri­ties claims as part of the deal.

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