Printing and technology major Hewlett-Packard announced plans to separate its operations into two public companies. One will focus on its printer and personal computer operations, while the other will deal with the corporate hardware and software services business of the giant. The printer and computer firm will be named Hewlett-Packard Enterprises, to be headed by current HP CEO Meg Whitman, and the other will be HP Inc, led by current executive vice president Dion Weisler.
The separation will take the form of a tax-free distribution of shares to current shareholders, which will take place in 2015. The transformation will also involve some 5,000 job cuts, savings from which will be used for research and development, the company said.
In an official statement, Whitman said that the separation will provide each of the two new companies with greater independence, more focused work, funding opportunities, and a flexibility that is necessary in the dynamic markets of modern day, ensuring a greater competitive advantage for the hardware and software, and the PC and printer businesses both.
