Activist investor Ralph Whitworth, famous for pushing for corporate breakups, is delighted that HP will be breaking itself into two companies, he said.
It’s not clear yet how much of a hand Whitworth had in orchestrating HP’s breakup, but we know he loves the idea. Here is his statement:
“HP’s board and management have made a brilliant value-enhancing move at the perfect time in the turnaround,” said Mr. Whitworth. “Today’s announcement sets out bold, logical and highly compelling steps that will align the company’s assets within more strategically and operationally focused corporate structures. 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.”
Mr. Whitworth continued, “At the same time, management can better design strategic plans, incentives and market initiatives to suit the varying growth rates, capital intensity, and market objectives of these more focused and nimble companies. The new companies will be better positioned to address today’s light-speed market dynamics and customer needs, and with distinct and compelling financial profiles and strong leadership teams, accelerate growth and shareholder value creation.”