Last week, it was eBay announcing a break-up of its business with eBay and PayPal becoming two separate public companies. This week, it's HP.
Hewlett-Packard announced that it too will split up into two public companies - Hewlett-Packard Enterprise and HP Inc. The former will focus on servers, storage, networking, converged systems, services, software, and its OpenStack Helion cloud platform. The latter will focus on personal systems and printing, including 3D printing as well as other "new computing experiences".
Meg Whitman will be President and CEO of Hewlett-Packard Enterprise with Pat Russo serving as Chairman of the Board. Dion Weisler will be President and CEO of HP Inc. Whitman will be chairman of that board.
Whitman said, “Our work during the past three years has significantly strengthened our core businesses to the point where we can more aggressively go after the opportunities created by a rapidly changing market. The decision to separate into two market-leading companies underscores our commitment to the turnaround plan. It will provide each new company with the independence, focus, financial resources, and flexibility they need to adapt quickly to market and customer dynamics, while generating long-term value for shareholders. In short, by transitioning now from one HP to two new companies, created out of our successful turnaround efforts, we will be in an even better position to compete in the market, support our customers and partners, and deliver maximum value to our shareholders.”
“Over the past three years, we have reignited our innovation engine with breakthrough offerings for the enterprise like Apollo, Gen 9 and Moonshot servers, our 3PAR storage platform, our HP OneView management platform, our HP Helion Cloud and a host of software and services offerings in security, analytics and application transformation,” she said. “Hewlett Packard Enterprise will accelerate innovation across key next-generation areas of the portfolio.”
“Since assuming responsibility for the Printing and Personal Systems Group, Dion and his leadership team have done an excellent job of building our relationships with customers and channel partners, segmenting the market and driving product innovation,” Whitman added. “The creation of HP Inc. will only accelerate the progress the team has made.”
The separation transaction will be tax-free to shareholders for federal income tax purposes, the company says. The transaction is expected to close by the end of fiscal 2015. It still needs to be approved by the Board of Directors.
In addition to the split, the company lifted its number of expected layoffs from between 45,000 and 50,000 to 55,000.
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