HP Will Keep PC Division After All

After the saga at the end of the summer that hit HP which involved the company replacing its CEO, Leo Apotheker, getting rid of the promising WebOS and mulling over plans to spin off its PC division.

The company announced today that it was shelving that last bit and said that "Continued combination of HP and its Personal Systems Group expected to deliver greater customer and shareholder value".

Meg Whitman, the new HP president and chief executive officer, said "HP objectively evaluated the strategic, financial and operational impact of spinning off PSG. It's clear after our analysis that keeping PSG within HP is right for customers and partners, right for shareholders, and right for employees".

Whitman explained that PSG is still the biggest manufacturer of personal computers in the world with revenues surpassing $40 billion for the fiscal year 2010, and is a key component to "deliver higher value, lasting relationships with consumers, small- and medium-sized businesses and enterprise customers".

In other words, the cons of getting rid of PSG would outweigh the advantages especially when it comes to the cost associated with the intangible contributions of the PSG to HP's solutions portfolio and overall brand value.

HP surprised the world of technology when it revealed that it was looking at "strategic alternatives for its Personal Systems Group" which included considering the option of spinning out its PC division.

Lenovo, which had acquired IBM's PC division and Medion and has entered a joint venture with NEC, emerged as an early favourite to acquire HP's PC brand.

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