According to a person familiar with the situation, the Chief Executive Officer of Hewlett-Packard Co. – Ms. Meg Whitman intends to separate the companys personal-computer and printer units from its enterprise hardware and service business, a move she rejected last year.
People close to the companys plans shared that Hewlett-Packard will officially announce the spin-off on Monday and that it will be carried out through a tax-free distribution of shares to shareholders in 2015.
In case the separation of Hewlett-Packards units goes as planned, the spin-off will result in two publicly traded companies, each of which will have an annual revenue of more than $50 billion.
Ms. Meg Whitman will remain at the position of Chief Executive Officer of the corporate hardware and service operations, to be known as Hewlett-Packard Enterprise, and she will also be chairman of the personal-computer and printer business, to be called HP Inc. Ms. Patricia Russo, current lead independent director, is said to become chairman of the enterprise company, while Dion Weisler, vice president in charge of the personal-computer and printer business, will take the position of Chief Executive Officer of that company after the separation is finalized.
On Sunday, one of HPs investors and until recently chairman – Mr. Ralph Whitworth commented on the rumors, cited by the Wall Street Journal: “This would be a brilliant move at just the right moment in the turnaround. It would liberate significant trapped value.”
A spin-off would be an abrupt change in Chief Executive Officer Whitmans policy, taking into account the fact that she ruled out a split after succeeding Mr. Leo Apotheker, saying that Hewlett-Packard remains committed to its personal-computer operations, which is considered a crucial unit of the company.
Ms. Sarah Pompei, a spokeswoman of Hewlett-Packard, refused to make any comments on the matter.
Hewlett-Packard Co. settled 2.00% higher on Friday in New York at $35.20 per share, marking a one-year change of +65.57% and valuing the company at $65.69 billion. Shares of the company soared 9.77% by 8:31 GMT on Monday in Frankfurt to trade at 29.65 euros. According to CNN Money, the 24 analysts offering 12-month price forecasts for Hewlett-Packard Co. have a median target of $40.00, with a high estimate of $45.00 and a low estimate of $32.00. The median estimate represents a +13.64% increase from the last price of $35.20.
TradingPedia.com is a financial media specialized in providing daily news and education covering Forex, equities and commodities. Our academies for traders cover 
