Autonomy gets a new owner – but what about those HP law suits?
In the late 1970’s I was working for the New Product Management Group, a London-based innovation consultancy based on a well-established patent agency. The Chairman, Dr. Basil Bard, had been CEO of the National Research and Development Corporation (NRDC) and was an expert in software licensing agreements. Micro Focus Ltd was one of his clients, and I can remember a very enjoyable lunch with Basil, Brian Reynolds and Paul O’Grady (the founders of Micro Focus) about the future of the UK software industry. Brian and Paul sold out long ago but for some reason I’ve always followed the development of the company.
I was of course very pleased to see that Micro Focus International PLC had pulled off a deal with HPE (aka “Hewlett Packard”) to acquire (technically a merger?) a substantial proportion its software assets, including Autonomy. You will recall that following the acquisition of Autonomy by HP quite a number of law firms and accountants were hired by HP to try to find out how a business valued at $8bn seemed to actually be worth substantially less. Unless I have missed some of the action none of these have yet come to court. There was a news story on Bloomberg that the main case would be heard in 2018. In any acquisition the acquiring company always seeks an indemnity about potential legal actions, as these could have substantial financial and reputation implications.
So what is now going to happen? Will HPE withdraw the actions or proceed to the court case? If I was Micro Focus I would not be happy about the latter option and if I were a stakeholder in HPE I’m not sure I’d be happy for the cases to be withdrawn. Another option is an out-of-court settlement. Because Micro Focus is a quoted company it will have to disclose the terms of any agreement over these legal suits to its shareholders. Intriguingly the lawyers for Micro Focus are Travers Smith LLP who are one of the flagship clients of BAInsight, so they will know a good search application when they see one! My guess is that HPE will want to draw a line under the entire affair, and that would be in the interests of not only Micro Focus but also of Mike Lynch and his former colleagues at Autonomy. One of these days the full story will be told but in the meantime it will be interesting to see what Micro Focus does with the Autonomy search software and its related assets.