British data-analytics specialist Autonomy has been bought by American giant Hewlett-Packard (HP) for £7.1bn, in the second-largest software deal of all-time.
The deal, which will bring Autonomy founder Mike Lynch a windfall of more than £550m, is also the biggest takeover of a UK business since Cadbury was acquired by Kraft for £11.5bn last year.
Hewlett-Packard made the decision to buy following a period of prolonged and impressive growth for Autonomy; over the last five years the company has increased its revenue at an annual compound rate of approximately 55%.
Autonomy posted record revenues of £155m in the second quarter of this year, and the firm now employs around 2,700 people around the world.
The value of Autonomy’s shares soared by 76% in response to the deal, and many analysts believe the HP buy-out offers excellent value for the company’s shareholders.
Said Lynch: “This is a momentous day in Autonomy’s history. 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.”
It is believed that HP will allow Autonomy to continue as a separate business, with Lynch remaining in charge. Having recently announced plans to shed its consumer-focused WebOS products and PC business, HP intends to increase its focus on the enterprise market over the coming months.
However, several experts have openly wondered whether HP is getting a good deal. Paul Morland, a tech analyst at Peel Hunt, told the Financial Times that the bid “seems to defy logic. We believe HP shareholders should be worried.”