Xerox Increases Offer Bid for HP Inc.
Xerox, which is currently engaged in a hostile-takeover bid for competitor HP Inc., today raised its offer for HP, announcing a new offer of $24.00 per share, which will be consist of $18.40 in cash and $0.149 in Xerox shares for each HP share. The offer will not be subject to any conditions related to financing or due diligence. Xerox plans to make the offer in March.
Xerox had previously offered to buy HP for $33.5 billion or $22 per share — $17 in cash and $0.137 in Xerox shares for each HP share.
Feedback from HP Stockholders
According to Xerox, it has met with, in some cases multiple times, many of HP’s largest stockholders. It said “These stockholders consistently state that they want the enhanced returns, improved growth prospects and best-in-class human capital that will result from a combination of Xerox and HP.”
“Immediate Value Creation”
According to Xerox: “The value created by the synergies realized in a combination of Xerox and HP is incremental to any value that HP can create by revising its strategic plan or dramatically changing its capital allocation policy to incorporate additional share repurchases. Xerox’s offer provides HP stockholders with both significant, immediate cash value, and meaningful upside via equity ownership in the combined company.”
The firm noted that its new offer price of $24.00 per share represents a 41 percent premium over to HP’s current share price of $17.00, and that implied offer value of ~$33 per share represents a 94-percent premium over HP’s current price of $17.00.
More information on the proposed merger is available here.
- January 2020: HP: Xerox Hostile Takeover Bid Driven by Carl Icahn; Denounces Xerox Board Nominations
- January 2020: It’s Official: Xerox to Nominate 11 to HP Inc. Board
- January 2020: Would a Xerox Acquisition of HP Really be Good for HP? Not Likely
- January 2020: HP Again Rejects Xerox Acquisition Offer
- January 2020: Xerox Says It’s Obtained Financing for HP Inc. Acquisition
- January 2020: Fuji Xerox to Terminate Technology Agreement with Xerox
- November 2019: Xerox Urges HP Buyout, Threatens Hostile Takeover