LONDON BRIEFING: Popular Irish-born academic Mike Lynch will stay on to run the firm he set up in college

WHEN A company boss cashes in his millions these days, he’s invariably greeted by a chorus of complaints, either that he doesn’t deserve his ill-gotten gains or that he’s leaving shareholders or employees in the lurch.

Not so with Mike Lynch, the former Cambridge academic who has just agreed the £7 billion cash takeover of the FTSE 100 software company Autonomy, in a deal that will boost his personal wealth by more than £500 million.

It is the largest ever sale of a European software maker.

Although the sale of Autonomy to the US technology giant Hewlett Packard has raised fears over the future of the software industry in the UK, there are few who begrudge Dr Lynch his riches.

Having founded the business in his Cambridge college bedroom in 1996, with the help of a £2,000 loan, he is one of those rare beasts who has successfully made the transition from academia to the corporate world.

Lynch, who is chief executive, still owns an 8 per cent stake in the business he founded, hence his bonanza. But other shareholders are in the money too. So keen was the US corporation to get its hands on the business, which is still based in Cambridge, the so-called Silicon Fen, that its takeover terms offered a generous 75 per cent premium on Autonomy’s market price.

Scores of employees will benefit too as they cash in 30 million of share options.

Tipperary-born Lynch, whose family moved to Essex when he was a child, is still only 45 and the other piece of good news for the company and its employees is that he’s staying on to run the business under its new owners, reporting directly to the head of HP, Léo Apotheker.

Lynch has built Autonomy into Britain’s biggest software maker and one of the most successful FTSE 100 companies; but nonetheless it still lacks the muscle of a true multinational corporation such as HP.

The Cambridge company’s expertise is in advanced data search and management – in simple terms, its software enables clients to search and manage unstructured data such as e-mails, phone calls and video.

Customers include most of the world’s major corporations, as well as space scientists at Nasa, anti-terrorism units and those tasked with rooting out corporate fraud. The combination of that expertise with the US company’s global reach and resources will take Lynch and Autonomy to the next level.

The business will remain based in Cambridge and, crucially, that is where its cutting-edge research and development activities will continue to be conducted. In other words, ownership of the company will be transferred across the Atlantic, but its expertise will be retained by the UK.

Software development is a world away from biscuit manufacturing and those who have raised the spectre of Cadbury’s unhappy fall under foreign ownership simply do not understand the nature of the software industry, says Lynch. Rather than viewing the HP deal as a loss to Britain, it should instead be seen as a vote of confidence.

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There has been a noticeably less enthusiastic reception to the near-£90 million windfall soon to be enjoyed by the founders of another British company, Stagecoach.

Brother and sister Sir Brian Souter and Ann Gloag will reap £51 million and £37 million respectively after the bus and rail group announced last week that it intended to return £340 million to shareholders.

Souter, who is chief executive, has a 15.1 per cent stake in the company and his sister holds 10.9 per cent. This makes the siblings, who are already estimated to be worth £650 million, the biggest beneficiaries of the move.

News of the windfall came just days after rail commuters learnt that they faced the biggest increase in fares since the industry was privatised in the mid-1990s, with increases next January of between 8 per cent and 13 per cent. RMT union leader Bob Crow claimed the £340 million being stripped out of Stagecoach was further proof that transport franchising in the UK is little more than a licence to print money.

Stagecoach shareholders will have the chance to voice their views on Friday, when the company holds its annual meeting. Another topic of discussion is likely to be the company’s decision to help directors reduce their tax bills by bringing forward payment of last year’s bonuses in a move that allowed Souter and finance director Martin Griffiths beat the government’s 50% tax rate.

PIRC, the corporate governance lobby group, is recommending that investors vote against the Stagecoach remuneration report in protest. The company, though, is urging shareholders to ignore PIRC’s advice. With the prospect of their own windfalls to come, Stagecoach shareholders may prefer to ignore the corporate governance lobby this time round.

Fiona Walsh writes for the Guardiannewspaper in London