Hewlett-Packard (HPQ) acknowledged late Thursday that the Department of Justice has launched a probe into the tech giant’s allegations of fraud at its Autonomy division.
The disclosure in an annual regulatory filing confirms reports that the DOJ had opened an investigation following the H-P’s bombshell allegations last month that Autonomy willfully cooked its books to inflate its value ahead of an eventual 2011 buyout valued at $11.1 billion.
U.S. authorities wasted little time, launching their probe on November 21, just a day after H-P said it would take a $5 billion charge due to an internal review that unearthed accounting fraud at the U.K.-based software business.
H-P had said it forwarded the matter to the DOJ, the Securities and Exchange Commission and the U.K.’s Serious Fraud Office.
However, Autonomy co-founder and former CEO Mike Lynch said in a statement late Thursday he has had “no contact from any regulatory authority.”
“We will co-operate with any investigation and look forward to the opportunity to explain our position.
We continue to reject these allegations in the strongest possible terms,” Lynch said.
The former Autonomy exec also took issue with H-P’s decision not to provide a “detailed calculation” of its $5 billion charge or a more detailed explanation of the fraud allegations in the regulatory filing.
“We remain deeply concerned about how this process has been conducted, and believe it is in everyone’s interest for it to be resolved as soon as possible,” Lynch said.
The Autonomy mess is hardly the first time that an acquisition by H-P has gone wrong.
In August H-P revealed an $8 billion writedown tied to its 2008 acquisition of Electronic Data Systems, representing more than half of the original $14 billion purchase price. H-P’s 2010 buyout of Palm for $1.2 billion has also been widely disappointing.
Shares of Palo Alto, Calif.-based H-P dropped 1.28% to $13.86 in extended trading Friday morning. The stock has lost about 45% of its value year-to-date.
-Original Post by Matt Egan, Reposted Courtesy of FOXBusiness. TechnoBuffalo is thrilled to bring you the best of FOXBusiness right here on our own pages to keep you immersed in all things digital.