Paying Too Much For Autonomy
August 18, 2011. It is a day that has come to live in HP infamy. All at once, HP announced that it was acquiring Autonomy for a mind-numbing $10.6 billion in cash and at the same time said it was exploring the possibility of selling off its then $41 billion PC business and that it was discontinuing its Touchpad tablet along with WebOS phones. Of all the moves, it is the high price that HP paid for Autonomy that hangs over the company like a black cloud. Fortune magazine has reported that HP CFO Cathie Lesjak at the time objected to the deal on the grounds that HP was paying 11 times revenues when comparable companies were priced at around three times revenues.