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Last updated: September 22, 2011 12:26 am
Hewlett-Packard shares jumped nearly 7 per cent as the board of the largest computer maker by revenue met and considered replacing chief executive Léo Apotheker after less than a year in the job.
HP directors on Wednesday were weighing possible temporary or permanent successors, including Meg Whitman, the former chief executive of Ebay and a HP board member, according to people close to the process.
Also under discussion was whether to keep the personal computer business, which Mr Apotheker said last month he planned to spin off.
HP was not expected to try to reverse its planned acquisition of Autonomy, the UK software group, for $10.6bn. Under the UK takeover code, it is very difficult for a company to walk away from an offer it has made without a material adverse change in the target.
More than 40 per cent of Autonomy’s shares have been tendered, and many of the remainder are held by hedge funds that have been holding out in the hope of a higher bid. If they see the chance of a deal being unwound, they are likely to tender quickly.
HP declined to comment, and Mr Apotheker did not respond to questions. Bloomberg had reported that Ms Whitman was in the frame for the job earlier in the day.
“He is like an organ transplant that didn’t take,” one person near the decision-makers said of Mr Apotheker, a former chief executive at business software maker SAP of Germany.
A change at the top would bring more upheaval to a major company whipsawed by the dismissal of Mr Apotheker’s predecessor, Mark Hurd, last year, and then Mr Apotheker’s dramatic moves to make HP more of a big-business software company.
Even as Mr Apotheker said that a trend toward tablet computing led by Apple was irreversible last month, he surprised many executives within HP by saying he would shutter the company’s answer to the iPad, the TouchPad, after just two months of sales.
The announcement of so many big moves at once left many investors deeply concerned that HP was floundering. The Silicon Valley company had also reduced its financial projections for the third time in a year, and HP shares skidded by 26 per cent in two days.
“This is a company with no clear strategy. It is making radical – and in some cases rash – moves with product lines when enterprise customers above else are looking for long-term, stable partners,” said George Colony, founder of technology consulting firm Forrester Research. “This is a board on trial.”
Even after the surge on Wednesday to $23.95, HP stock is trading at half the level it was in February.
Ms Whitman recently lost a bid to become governor of California. She could not immediately be reached for comment.
Additional reporting by Maija Palmer in London
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