Because of "serious accounting improprieties" Hewlett Packard is taking an $8.8 billion write-down on Autonomy, a company it acquired last year for $11.7 billion, which essentially wipes out all of its profits for last quarter, reports DealBook's Michael De La Merced. Oh boy. The struggling HP is blaming Autonomy, a British "human information" and enterprise search company, for lying about its finances during the acquisition. It originally made the purchase in 2011 because it thought Autonomy's portfolio would help its ailing finances by complementing "existing enterprise offerings" and giving it "valuable intellectual property," as De la Merced and Jeffrey Cane put it in an earlier DealBook report. But, because of these misrepresentations the already hurting company, which plans to do a huge round of lay-offs over the next year, or so, has now lost a ton of money on a company The Guardian's Dominic Rushe describes as "one of Britain's brightest tech stars." "It is a major setback for H.P., which has been struggling to turn around its operations and remake its business," as Merced puts it.
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