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Hewlett-Packard to split itself into two public companies

Hewlett-Packard has announced that they will split the company into two listed companies.
October 7, 2014

Hewlett-Packard has announced that they will split the company into two listed companies. One company will be in charge of computers/printers while the other will be in charge of corporate hardware and services. It is expected that HP will also lose as many as 55,000 employees from such a split.

The split-off computer company, named HP Inc., will headed by one of HP’s existing executives, Dion Weisler, while current CEO Meg Whitman would run the corporate company, named Hewlett-Packard Enterprise (although she will also be chairman of the board for HP Inc.).

This isn’t the first time that HP was thinking of splitting the company. In 2011, former Chief Executive Leo Apotheker proposed to separate their PC business. This plan was eventually shelved as current CEO Meg Whitman decided not to go forward with such a plan.

HP shareholders will own a stake in both companies. At the moment, HP is expected to generate $112 billion in revenue for the fiscal year while each company currently contributes about half of HP’s revenue and profit.


Dell was not as excited about this move as others. They released a statement claiming that the split-off will help shareholders more than customers.

“HP’s decision to break apart its business is complex, distracting and appears to benefit HP and its shareholders more than its customers, which is ultimately the wrong priority. The HP separation will be complex and it takes time to unwind the commingled businesses and customer accounts. Other large separations like this have often taken years to complete.” – Dell

As the Wall Street Journal notes, a number of analysts are still guessing about what HP’s long-term plans may be for both companies.