At Hewlett Packard Enterprise, CEO Antonio Neri is negotiating with activist investors with a history of ousting CEOs
In April, a group of activist investors was first reported Elliott Management acquired $1.5 billion in stake Hewlett Packard Enterprise (HPE) has since been completely silent on the issues of both companies.
This investment is known to be a long stand in contrast to a short bet on the company, but it is acute for HPE and its CEO Antonio Neri. After Elliott took stock in their company and demanded consultation with the board, 14 chief executives were kicked out of their work, According to Reuters.
Is Neri’s neck in the chopping block?
luck They asked the companies for comment, but neither of them wanted to talk about what was going on between them on the record. hpe (Fortune 500 No. 143) provided a simple statement saying, “We value the constructive input of all our shareholders,” but refused to enter into the details.
However, the sources we talked about luck I pointed out a few hidden clues about what Elliott potentially wants from HPE.
Pricing Screwing
The most obvious indication of the trouble came when HPE published its first-quarter revenue in March, with inventory tied by nearly 16% that day. Neri gave it Interviews about CNBC He admitted that the company made a mistake considering the cost of inventory.
“Nearly the end of the quarter we realised that the cost of inventory was slightly higher than what was priced. It’s with us. It never happens,” Neri said.
That was modest. Screwup has wiped out more than $3 billion from HPE’s market capitalization.
Low performance stock
We also paid attention to HPE’s stock price.
News that Elliott had an impact on the company has released a research note that JP Morgan analyst Samic Chattersee and his team are likely to “1) dealing with discounts in which HPE stocks trade on a standalone basis compared to peers.
Chatterjee has also published a brutal table comparing HPE performance numbers with Dell, Cisco and Dell. netapp. That showed that HPE generated only $494,000 per employee, while Dell generated $885,000.

HPE strains have recently jumped up after the Department of Justice stopped investigating the proposal Juniper Network Acquisition. Still, since 2018, HPE shares have grown 48% per share, just above $21. Meanwhile, the S&P 500 rose 135%. This is a disastrous performance for high-tech companies that should benefit strongly from Mania around AI.

Elliot prefers to avoid proxy fights
Neri has been CEO for seven years. Meanwhile, six of HPE’s 12 board members have been there for over a decade. Patricia F. Russo, chairman of the board, has been there since 2015. The meaning is that it may be time for new blood.
But kicking out Neri may not be Elliot’s plan.
Another option is for HPE to give Elliott a seat on the board and agree to a strategy that will turn the company around. One of Elliot’s other adventures, attacks on an oil refinery company Phillips 66Investment funds have been created Pleas to shareholders It showed that in reality they prefer to reach a mutal agreement with the company rather than escalating into a full-scale civil war through proxy votes for shareholders.
“We have been working with over 200 companies over the past 15 years to arrive at mutually beneficial solutions that increase shareholder value. During this period, we have had to pursue only three US proxy contests to this stage of the process, making the Phillips 66 an extreme outlier.
It is not clear what is going on between HPE and Elliott, but the board may be in discussion with new stakeholders.
HPE said luck “HPE and our board of directors maintain an ongoing dialogue with shareholders on a variety of issues. While we have not commented on specific communications with shareholders, we value the constructive input of our shareholders and all other stakeholders.”