UK's 'Bill Gates' Acquitted Of Fraud Charges Linked To $11B Hewlett-Packard Takeover Deal

Author: Benzinga Neuro | June 07, 2024 08:51am

Mike Lynch, once lauded as Britain’s answer to Bill Gates, has been acquitted of charges related to the controversial $11 billion deal between his company Autonomy and Hewlett Packard Enterprise Co (NYSE:HPE) in 2011.

What Happened: Lynch was acquitted on Thursday of criminal charges of fraudulently inflating revenues at his company Autonomy before selling it to HP, the Wall Street Journal reported on Thursday.

The U.S. government charged Lynch with conspiracy and wire fraud in 2018, alleging that he falsely inflated Autonomy’s revenues to make the software company more appealing to potential buyers.

The deal, which aimed to transform HP into a software and services provider, quickly turned sour, leading to an $8.8 billion write-down and the company’s eventual split in 2015.

Lynch, who served as Autonomy’s CEO, expressed his elation at the verdict and his desire to return to the U.K. and focus on his family and innovation.

Why It Matters: This acquittal marks the end of a long legal battle that began with the controversial Autonomy deal. Lynch’s extradition to the U.S. in 2023, where he faced criminal fraud allegations, was a major turning point in the case. The deal, which was initially seen as a strategic move for HP, eventually led to a $4 billion loss for the company, attributed to fraudulent practices by Lynch and his team.

Meanwhile, HP has gone through significant changes since the Autonomy deal. The company reported better-than-expected Q2 results in 2024, with a 3.26% increase in sales over the previous year, indicating a positive trajectory for the tech giant.

Price Action: On Friday pre-market, HPE was trading 0.46% higher at $19.68 after closing at $19.59 on Thursday, according to Benzinga Pro.

Photo via Wikimedia Commons

This story was generated using Benzinga Neuro and edited by Pooja Rajkumari

Posted In: HPE HPQ