Mike Lynch, the founder of Autonomy, has hit out again at HP allegations that it was lied to during its acquisition of the British banking software outfit.

Last week, HP slammed former members of management at Autonomy, which it acquired last year in a deal worth $12 billion. It accused them of "inflating" the value of the company prior to the takeover as part of a "wilful effort to mislead". This led to a $5 billion charge in its latest quarterly accounts. Lynch strongly denied the allegations. “This is a company that has delivered its worst results in years and I’m not going to be HP’s scapegoat for a company that’s in utter disarray,” he told Sky News. “HP came in with about 300 people, crawled over everything and found nothing wrong. And you know why? Because there was nothing wrong. The write down is due to them destroying value, they have mismanaged Autonomy.”

And this week, he has issued an open letter in which he notes: “It was shocking that HP put non-specific but highly damaging allegations into the public domain without prior notification or contact with me, as former CEO of Autonomy. I utterly reject all allegations of impropriety…Can HP really state that no part of the $5 billion write down was, or should be, attributed to HP’s operational and financial mismanagement of Autonomy since the acquisition? I have been truly saddened by the events of the past months and am shocked and appalled by the events of the past week.”

In a response to the open letter, HP said that it had initiated “an intense internal investigation into a series of accounting improprieties, disclosure failures and outright misrepresentations that occurred prior to our acquisition of Autonomy. We believe we have uncovered extensive evidence of a willful effort on behalf of certain former Autonomy employees to inflate the underlying financial metrics of the company in order to mislead investors and potential buyers.”

It added that the matter is in the hands of the authorities, including the UK Serious Fraud Office, the US Securities and Exchange Commission’s Enforcement Division and the US Department of Justice. “We will defer to them as to how they wish to engage with Dr. Lynch. In addition, HP will take legal action against the parties involved at the appropriate time. While Dr. Lynch is eager for a debate, we believe the legal process is the correct method in which to bring out the facts and take action on behalf of our shareholders. In that setting, we look forward to hearing Dr. Lynch and other former Autonomy employees answer questions under penalty of perjury.”

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