Autonomy Starts Acquisitions Talks, May List in U.S.

Michael Lynch, chief executive officer of Autonomy Corp
Michael Lynch, chief executive officer of Autonomy Corp., speaks during an interview in London, on Feb. 3, 2010. Photographer: Chris Ratcliffe/Bloomberg

Autonomy Corp Plc, the U.K.’s second-largest software company, is starting conversations about potential acquisitions after raising 500 million pounds ($769 million) by selling convertible bonds.

Autonomy, which typically targets U.S.-based companies for purchases, needed to raise the money because it can’t offer U.S. stock as part of an acquisition, Chief Executive Officer Mike Lynch said today in a telephone interview.

“To get a sensible conversation going, one has to have the cash ready to go,” Lynch said. “Now that cash has been raised we’re in a position to have those conversations.”

The software company, which gets about 70 percent of revenue from North America, may also consider a dual listing in the U.S., Lynch said, speaking from San Francisco after being delayed by the volcanic ash cloud. The Cambridge, England-based company has no current plans to seek a U.S. listing, he said.

Shares rose as much as 1.5 percent to 1,808 pence in London trading today and stood at 1,807 pence as of 9:05 a.m.

“Anything that enhances the ability for U.S. investors to buy the stock would be a positive,” Roger Phillips, an analyst at Evolution Securities, said via phone today. He added there had been a lot of interest in the past year from U.S.-based investors.

First-quarter sales excluding acquisitions rose 17 percent, after an increase of 16 percent in 2009, Autonomy said today in a statement. The company last year bought U.S. software provider Interwoven Inc. for $775 million.

First-quarter net income rose to $49.7 million from $34.5 million after Autonomy won orders from companies including AT&T Inc. Total sales surged 50 percent to $194.2 million.

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