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GM Agrees to Absorb 3,000 Hewlett-Packard Workers

Oct. 18 (Bloomberg) -- General Motors Co., seeking to increase its internal information technology abilities, said it agreed to absorb 3,000 Hewlett-Packard Co. workers performing duties for the automaker and make them GM employees.

GM also has purchased Hewlett-Packard’s IT Performance Suite, Enterprise Security Suite, Vertica and Autonomy Software, the Detroit-based automaker said in a statement on its website.

The largest U.S. automaker has said it will hire about 10,000 people as part of its plan to bring more work in-house. It previously announced two of four new so-called innovation centers in Warren, Michigan, and Austin, Texas. The transfer of most of the workers from Hewlett-Packard will take place over the next six months, Chief Information Officer Randy Mott said on a conference call with reporters.

“General Motors is undergoing one of the most profound transformations in our corporate history and GM IT is an important part of that transformation,” Mott said. “We’re transforming our IT operating model to improve performance, reduce the cost of ongoing IT operations and increase the level of innovation that we deliver to the business.”

The agreement to transfer employees from Hewlett-Packard to GM will be “a cost-neutral solution” for the automaker, according to the statement.

GM does about 10 percent of IT work internally and plans to boost that to 90 percent, Mott said. Chief Executive Officer Dan Akerson wants to update GM’s computer and accounting systems as he reorganizes the company around global functions and brands, two people familiar with the thinking have said.

GM gained 2 percent to $25.56 for its highest New York closing price in six months. Palo Alto, California-based Hewlett Packard rose 0.5 percent to $14.80.

To contact the reporters on this story: Tim Higgins in Sao Paulo at thiggins21@bloomberg.net; Mark Clothier in Southfield, Michigan at mclothier@bloomberg.net

To contact the editor responsible for this story: Jamie Butters at jbutters@bloomberg.net

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