HP’s board of directors have approved the previously announced separation of the company into two independent, industry-leading companies: Hewlett Packard Enterprise and HP Inc. The separation is expected to completed on 1 November.
HP said Hewlett Packard Enterprise will provide systems needed by enterprises to optimise their traditional IT while helping to build a secure, cloud-enabled, mobile-ready future. Specifically, the company will include HP’s best-in-class portfolio across its Enterprise Group, Enterprise Services, Software and Financial Services businesses. HP Inc will own and operate HP’s market leading printing and personal systems businesses. The company will have a broad portfolio and a strong innovation pipeline across areas such as multi-function printing, Ink in the Office, graphics, commercial mobility, and services.
CEO Meg Whitman said the separation will enable the company to accelerate the turnaround it began four years ago. “As two independent, industry-leading companies, Hewlett Packard Enterprise and HP Inc can drive more focused business strategies, innovation roadmaps, and go-to-market models. The separation will also present better choices for investors by creating two distinct and attractive investment profiles,” the CEO said.
The separation will occur by means of a pro rata distribution to HP stockholders of 100 percent of the outstanding shares of Hewlett Packard Enterprise. The distribution is expected to occur on 1 November. In connection with the separation, HP will be renamed HP Inc. Consequently, the separation will provide HP stockholders with ownership interests in both HP Inc and Hewlett Packard Enterprise. Each HP stockholder will receive one share of Hewlett Packard Enterprise common stock for every one share of HP common stock held as of 21 October, the record date for the distribution. No fractional shares of Hewlett Packard Enterprise will be issued. Stockholders will receive cash in lieu of fractional shares.
Hewlett Packard Enterprise shares are expected to start trading on the New York Stock Exchange (NYSE) on or around 19 October under the ticker symbol “HPE”. HP (to be renamed HP Inc) will continue to trade on the NYSE under the ticker symbol “HPQ”.
The separation and distribution remain subject to certain conditions, including, among others receipt of a favourable IRS ruling and opinions of HP’s tax advisors regarding certain US federal income tax matters and the effectiveness of the Form 10.
