The estate of Mike Lynch, who died a year ago when his superyacht sank off the coast of Sicily, and his business partner owe Hewlett-Packard more than £700m, a court has ruled.

The US technology company has been seeking damages of up to $4.55bn (£3.37bn) from the estate of the late tycoon, once hailed as the UK’s answer to Microsoft founder Bill Gates, over its disastrous takeover of his British software company Autonomy.

Lynch’s estate has been estimated to be worth about £500m and paying its share of the £700m damages could leave it bankrupt.

He and six others, including his 18-year-old daughter Hannah, died last August on a trip celebrating his acquittal on US fraud charges relating to HP’s $11bn takeover of Autonomy in 2011.

However, HP won a separate six-year civil fraud case against Lynch and his former finance director Sushovan Hussain in the English high court in 2022, with Mr Justice Hildyard ruling that the US company had been induced into overpaying for the business.

In a ruling at the high court on Tuesday, Hildyard ruled on the amount owed to HP. He determined that HP sustained losses of more than £646m in relation to the difference between what it paid for Autonomy and what it would have paid if its true financial position had been known.

“Autonomy’s true financial position and performance had not been properly and accurately disclosed, and had it been so, HP would not have proceeded with its acquisition of Autonomy at the bid price,” said Hildyard.

Hildyard also said HP was entitled to another £51.7m in relation to “personal claims for deceit and/or misrepresentation against Dr Lynch and Mr Hussain”.

On Tuesday, Hildyard said he considered that HP’s original $4.55bn claim “was always exaggerated, and I have concluded that there is more than a grain of truth in Dr Lynch’s submission”.

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Lynch had intended to appeal against the high court’s 2022 ruling, a process that was on hold pending Tuesday’s decision on damages.

A spokesperson for the Lynch family said they would consider an appeal to the damages ruling, adding that it reflected “that HP’s original $5bn damages claim was not just a wild overstatement – misleading shareholders – but it was off the mark by 80%”.