Hewlett-Packard fires boss Fiorina

CARLY Fiorina, one of the most powerful and high-profile women in the business world, has been ousted as chairman and chief executive of US technology giant Hewlett-Packard.

The shock departure of 50-year-old Fiorina sent shares in HP, a component of New York's Dow Jones Average, surging 9% to $21.96, taking the rest of the market higher with the ripple effect spreading to European markets.

The departure of the controversial business leader, paid $3.3m (£1.7m) in 2003, was widely welcomed by HP followers, who have increasingly feared that she was pursuing the wrong strategy for the group. It was accompanied by news that first-quarter earnings, due next week, will be in line with market expectations.

Fiorina, one of the few women to head a Fortune 500 company, has come under increasing criticism as HP struggled to meet the promises made at the time of the fiercely-contested $19bn (£10.2bn) takeover of Compaq Computer five years ago.

Speaking at the World Economic Forum in Davos two weeks ago, Fiorina defended the poor performance of the 66-year-old company since the merger and dismissed reports of a rift at the top. Her relationship with the board was 'excellent', she claimed.

Today she said: 'While I regret the board and I have differences about how to execute HP's strategy, I respect their decision. HP is a great company and I wish all the people of HP much success in the future.'

The board said it felt the 'time was right' for a change and HP needed a chief executive with 'a new set of capabilities'. Fierce criticism came from Walter Hewlett, one of the heirs of cofounder Bill Hewlett. The academic, who oversees the Hewlett family trust and foundation, strongly questioned the Compaq deal at the time and said today that the company needed 'good leadership'.

Fiorina was unable to focus on execution of the merger or on controlling costs, he said, adding that he may now start buying stock in the group.

Fiorina departs immediately - no details of any pay-off were given - and the search for a new chief executive is under way. Chief financial officer Robert Wayman steps up to fill the gap until a successor is found. Patricia Dunn, on the board since 1998, has been appointed non-executive chairman.