Autonomy sold to HP for $11 billion

Autonomy Corporation, the Cambridge UK-based web infrastructure software company, is being acquired by Hewlett-Packard (HP) for £6.6 billion. It is the largest deal in Cambridge corporate history.

The deal has been unanimously approved by both boards. CEO Mike Lynch will continue to lead Autonomy.

Based on the closing stock price of Autonomy on August 17, the consideration represents a one-day premium to Autonomy shareholders of around 64 per cent and a premium of some 58 per cent to Autonomy’s prior one month average closing price.

The acquisition is expected to be completed by the end of 2011.

“This is a momentous day in Autonomy’s history,” said Dr Mike Lynch, chief executive officer and founder, Autonomy.

“From our foundation in 1996, we have been driven by one shared vision: to fundamentally change the IT industry by revolutionising the way people interact with information.

“HP shares this vision and provides Autonomy with the platform to bring our world-leading technology and innovation to a truly global stage, making the shift to a future age of the information economy a reality.”

Founded in 1996, Autonomy is a global leader in infrastructure software for the enterprise with a customer base of more than 25,000 global companies, law firms and public sector agencies, and approximately 2,700 employees worldwide.

Autonomy’s Intelligent Data Operating Layer (IDOL) platform allows computers to harness the richness of information, forming a conceptual and contextual understanding of any piece of electronic data, including unstructured information, such as text, email, web pages, voice and video.

Its software powers a full spectrum of mission-critical enterprise applications, including pan-enterprise search, customer interaction solutions, information governance, end-to-end eDiscovery, records management, archiving, business process management, web content management, web optimisation, rich media management and video and audio analysis.

Autonomy’s recent operating and financial performance has been strong, including its most recent results for the quarter ending June 30. Over the last five years, Autonomy has grown its revenues at a compound annual growth rate of around 55 per cent and adjusted operating profit at a rate of 83 per cent.

Léo Apotheker, HP president and chief executive officer, said: “Autonomy presents an opportunity to accelerate our strategic vision to decisively and profitably lead a large and growing space.

“Autonomy brings to HP higher value business solutions that will help customers manage the explosion of information. Together with Autonomy, we plan to reinvent how both unstructured and structured data is processed, analysed, optimised, automated and protected.

“Autonomy has an attractive business model, including a strong cloud-based solution set, which is aligned with HP’s efforts to improve our portfolio mix. We believe this bold action will squarely position HP in software and information to create the next-generation Information Platform, and thereby, create significant value for our shareholders.

“Autonomy is a highly profitable and globally respected software company, with a well-regarded management team and talented, dedicated employees. We look forward to partnering with a company that shares our commitment to solving customer problems by creating smart, cutting-edge products and solutions.

“I am particularly pleased that Dr Mike Lynch, who heads a team of brilliant scientists and employees, will continue to lead Autonomy. I look forward to our collaboration as we focus on creating maximum value for the combined company, its customers and employees.”

Key Autonomy assets will provide HP with the ability to reinvent the $55 billion business analytics software and services space, which is growing at eight per cent annually.