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HP shareholders challenge directors

Warwick Ashford

HP shareholders have challenged the authority of the board by registering a strong protest vote against the re-election of five directors at its annual meeting.

The board is under pressure after ousting of two chief executives and a series of disastrous acquisitions, including an $8.8bn write-down on HP's acquisition of UK software firm Autonomy, reports the Guardian.

The strongest protest vote was against the two longest serving directors, John Hammergren and Kennedy Thompson, with 46% and 45% of votes cast against their re-election respectively.

Close behind, chairman Raymond Lane attracted a 41% against his return, 30% voted against Marc Andreessen and 20% against the lead independent director, Ralph Gupta.

All 11 members of the board were re-elected with the required majorities, but shareholders supported a proposal allowing them to nominate candidates for the board in future years.

The rebuke by shareholders was compounded by the publication this week of an open letter from Autonomy founder Mike Lynch, who is fighting to clear his name.

HP has accused Lynch of manipulating Autonomy's accounts to inflate its value. But in his open letter, Lynch said HP had acted in an "aggressive and unusual manner" in recent months.

Lynch has re-iterated his call for HP to produce any evidence it had to back up the claims against him.

Earlier this month, the Serious Fraud Office joined the ranks of those wanting to have a closer look at what was happening at Autonomy.

HP's chief executive, Meg Whitman, defended her board. "My view about the board of directors is the lineup we have right now is helping us turn around the company," she said.

However activist investor Ralph Whitworth, who joined the HP board in 2011, said work was ongoing to find new directors, indicating new appointments could be made in months.


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