Mercury CEO: HP acquisition thrills customers

02.08.2006
Tony Zingale arrived at Mercury Interactive Corp. in 2004 and took over as CEO after his predecessor and two other top executives were dismissed amid allegations over stock options irregularities. Even as Mercury continues to cooperate with a formal investigation by the Securities and Exchange Commission, it is in the midst of an acquisition by Hewlett-Packard Co. Zingale spoke with Computerworld Tuesday about his past year, the planned HP buyout and the coming integration of Mercury and HP products. Excerpts from that interview follow:

You've lived through quite a year with a federal investigation of stock options activities at Mercury, the departure of your predecessor and last week's news of an HP purchase worth US$4.5 billion. How has it felt? I actually feel great about the outcome, just to jump right to the conclusion. It has been a super outcome for all the constituencies. The HP deal is a strategic fit. There's not a lot of product overlap. It is a cultural fit. Lastly, it is a good economic deal for both companies. I am very, very satisfied and thrilled with the outcome.

But I have to ask what you tell your customers who are worried that the investigation of your stock options by the SEC is not over. Is that problem behind you? The restatement is behind us. We've completed all the necessary restatement work in and around restating 10 years of financial results. That's behind us. We recertified all the company's revenues and expenses, so that set of issues is behind us for sure.

So what have you and the company learned as a result? We've learned that you have to stay focused on running your business. And it's not just us [facing investigation]; there are about 80 companies facing a similar set of issues. A company needs good corporate governance, good processes; and you've got to have a great business to keep your executive team focused on. The situation I came into at Mercury was one of having a great product line and a great business, but unfortunately I came into a set of issues beyond my control that I had to clean up. I used the management team and all their professionalism and maturity to get this set of issues behind us. And what I was after was sustaining the business and the growth that Mercury was capable of.

Do your big customers bring up the investigation anymore? Sure, and they're thrilled the restatement is behind us. What lends credibility to it is that 80 other companies are just beginning a similar [investigative] process.

Even with the HP acquisition plans, you're going to hold your Mercury World user event in Vegas in October? Yes, it's full speed ahead for Mercury World. We get 3,000 to 4,000 customers usually at the annual show, with a full range of partners. Last year, we announced 25 new products. This year they'll want to know what's new with the potential integration with HP's systems management and OpenView products.