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Hewlett-Packard launch £6bn takeover bid for Autonomy

UK-based search software company confirms approach from US technology multinational

British software company Autonomy has received a bn (£6bn) takeover bid from the giant technology multinational Hewlett-Packard.

The approach, confirmed on Thursday evening by Autonomy, would represent a 70% premium to its market capitalisation of £3.5bn.

Hewlett-Packard is also planning to spin off its personal computer business, according to a report on Bloomberg, and may announce the move along with its quarterly earnings report after US markets close today.

In March, HP chief executive Léo Apotheker announced that the company would be shifting away from manufacturing hardware towards cloud computing – offering software and services over the internet.

Autonomy, which specialises in search software for big companies, allowing them to trawl through their own databases and seek out content from emails, mobile phones and even instant messaging services, has also moved into cloud computing.

It now stores data on behalf of its clients, which include Coca-Cola, Nestlé and the US Securities and Exchange Commission. Earlier this year, the Cambridge-based company spent 0m in buying a digital archiving business from storage company Iron Mountain.

Autonomy was co-founded in 1996 by Mike Lynch, who remains chief executive to this day. He railed last year against UK investors and analysts, complaining that a lack of understanding of the software business had left Autonomy’s shares undervalued.

His company reported full year revenues for 2010 of 0m, up 18% on the year before, and profit before tax of 9m.

In a statement released on Thursday night, the company said: “The board of Autonomy notes recent press speculation and confirms that it is in discussions with Hewlett-Packard regarding a possible offer for the company.”

Autonomy’s shares were among the top 10 fallers in the FTSE 100 on Thursday, closing down 8.3% at £14.29. © Guardian News & Media Limited 2011 | Use of this content is subject to our Terms & Conditions | More Feeds