"Ralph Whitworth, a H-P director and principal at Relational Investors LLC, will run the board temporarily until H-P recruits a permanent chairman. Mr. Lane will remain on the board but two other directors, John Hammergren and G. Kennedy Thompson, will resign," the Journal reports.
The move is seen as fallout from the company's botched acquisition of Autonomy Corp. Hewlett-Packard acquired the U.K. software maker for nearly $11 billion, but it didn't know that that the company had lied about its revenues to inflate its price. H-P was forced to write down more than $8 billion of that purchase price.
"Lane, Thompson and Hammergren were re-elected in slim majorities in a referendum last month that demonstrated growing dissatisfaction with the company's performance and takeover of Autonomy. An $8.8 billion writedown of the company, disclosed in November, capped a three-year stretch of management upheaval, strategy shifts and slowing growth that hammered shares and made it harder for Chief Executive Officer Meg Whitman to turn around growth at the computer maker.
"'It's the right thing, even if a little late,' said Erik Gordon, a professor at the Ross School of Business at the University of Michigan. Ray Lane 'was just barely re-elected to the board and was chairman during HP's most horrible years. His legendary status didn't do anything for HP.'"
The Wall Street Journal reports that four board members resigned in early 2011.
"The Palo Alto, Calif., company was hoping for a period of stability under the new lineup. In late February, H-P CEO Meg Whitman said she didn't expect imminent board changes, saying 'we have a very good collection of individuals,' many of whom had served less than two years," the Journal adds.