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Hewlett-Packard set to split into two public companies

Hewlett-Packard set to split  into two public companies
As reported by an agency, HP said its shareholders would own a stake in both businesses through a tax-free transaction next year. Each of the two businesses contribute about half of HP's current revenue and profit.

The splitting move will result in a reshaping of one of technology's most important pioneers, which has more than 300,000 employees and is on track to book $112 billion in revenue the fiscal year ending October.

‘Shareholders will now be able to invest in the respective asset groups without the fear of cross-subsidies and inefficiencies that invariably plague large business conglomerates,’ Ralph Whitworth, former HP chairman and founder of Relational Investors LLC, said in a statement.

Relational owns a 1.49 percent stake in HP, which had a market value of about $66 billion as of Friday. Many investors and analysts had called for a break-up of the company, or a sale of the personal computer business, so that HP could focus on the more profitable operations of providing computer servers, networking and data storage to businesses.

Spinning off operations is an attempt to become more agile and capitalize on faster-growing businesses.

Online auction company eBay Inc said last week it would spin off electronic payment service PayPal.
HP's current chief executive, Meg Whitman, will lead the new Hewlett-Packard Enterprise, which will house the corporate hardware and services operations, agency reported.

Current HP lead independent director Patricia Russo will be chairman of the enterprise company.
HP's printing and personal computing business, to be known as HP Inc, will be led by Dion Weisler, currently an executive in that division. Whitman will be chairman of HP Inc.

Founded by Bill Hewlett and Dave Packard in a Palo Alto, California garage in 1939, HP was one of the companies that shaped Silicon Valley and the PC revolution. Lately, however, it has struggled to adapt to the shift towards mobile computing, and it has been overshadowed by younger rivals such as Chinese PC maker Lenovo, which is now the world's No. 1 PC maker by shipments.
Agencies

Agencies

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