The UK Serious Fraud Office is dropping its investigation into the controversal £7bn sale of Autonomy to HP, but the US will continue its examination of the deal.
The Serious Fraud Office (SFO) stated: "In respect of some aspects of the allegations, the SFO has concluded that, on the information available to it, there is insufficient evidence for a realistic prospect of conviction."
Writing on the AutonomyAccounts.org website, former Autonomy CEO Mike Lynch (pictured) welcomed the SFO's decision: "As we have always said, HP’s allegations are false, and we are pleased that after a two-year review of the material presented by HP, the SFO has concluded that there is not a case to pursue," he said.
"Let’s remember, HP made allegations of a $5bn fraud, and presented the case in public as a slam dunk. HP now faces serious questions of its own about its conduct in this case and the false statements it has made."
Lynch is not in the clear yet though, as a US investigation is still underway.
"In respect of other aspects and on the application of well-established principles, jurisdiction over the investigation has been ceded to the US authorities whose investigation is ongoing," said the SFO.
"In order not to undermine the US-based investigation we are unable to go into further detail at this stage regarding the basis of these decisions."
HP announced it would acquire Autonomy in 2011, in a bid to shift from a hardware-centric company to one focused on software. Soon after, HP CEO Leo Apotheker was fired following his decision to sell-off HP’s PC business, and spend £7bn acquiring Autonomy. In October 2014, current CEO Meg Whitman announced she was splitting HP in two, a move that bears a striking resemblance to Apotheker’s earlier attempts to spin-off the HP PC business.
More on HP-Autonomy dispute
- HP sues Autonomy's former chief financial officer, Sushovan Hussain
- HP set to settle with shareholders over lost Autonomy billions
- HP chairman Ray Lane steps down following shareholder attack
- Investors sue HP for $1bn over Autonomy deal
- HP knew of Autonomy hardware sales tactics
- HP investigators find Autonomy made 80% less profit than stated
- HP dumps Apotheker and hires Whitman
In 2012 HP announced a writedown of $5bn amid allegations that it had been defrauded by Autonomy during the acquisition of the software company. In August last year, HP said it would sue Autonomy's former chief financial officer, Sushovan Hussain, over his part in the 2011 acquisition of the UK software company.
Following publication of an article in the FT in December, which quoted from an internal HP document, Lynch wrote: "HP was aware of the transactions addressed in the document before completing the acquisition of Autonomy, and did not raise any concerns. The column headings in the document purely address whether or not valid transactions were reported under IFRS, or could be open to interpretation. Where HP considered there was a possibility to classify revenue differently, they did so. This shows that HP arbitrarily adjusted whole categories of deals it already knew about and did not question before it made the acquisition."
The dispute hinges on HP's claims about how Autonomy reported contracts in its financial accounts. Last year, HP claimed that Autonomy made 80% less profit and 54% less revenue than was originally stated.