Xerox Considers Takeover Offer for HP

hawki · Nov 6, 2019

"Xerox Is Considering a Bid for HP...

Xerox Holdings Corp. is considering a cash-stock offer for the $27 billion PC giant HP Inc., the Wall Street Journal reported, a deal that could combine two of the biggest American names in office hardware..."

https://fortune.com/2019/11/06/xerox-hp-bid-merger/

mood · Nov 6, 2019

HP confirms it has received a proposal from Xerox about being acquired
November 6, 2019
https://techcrunch.com/2019/11/06/h...-discussions-with-xerox-about-being-acquired/

Rumors have been flying today about Xerox possibly buying HP Inc., the printer and computer company. The company issued a public statement this afternoon confirming that there are talks ongoing, and that it will do whatever is in the best interest of shareholders.

HP acknowledged there are ongoing discussions between the two companies and that it received an offer letter from Xerox yesterday. What’s odd about this particular deal is that HP is the company with a much larger market cap of $29 billion, while Xerox is just a tad over $8 billion. The canary is eating the cat here.
Here is HP’s complete statement on the situation: [...]
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Press Release: HP Issues Statement Addressing Market Speculation

mood · Nov 10, 2019

Five reasons HP might oppose a Xerox takeover
November 11, 2019
https://www.crn.com.au/news/five-reasons-hp-might-oppose-a-xerox-takeover-533745

Xerox's takeover offer for HP Inc. is reportedly 23 percent higher than where HP shares started the month, and would bring together the leaders in A4 and A3 devices at a time when the print industry is ripe for consolidation.

HP, however, is much more than a print company, as the No. 2 maker of PCs worldwide and an up and comer in the realm of 3D printing. There are plenty of reasons why HP's leadership, including brand-new CEO Enrique Lores, might not welcome the idea of being absorbed by its smaller print competitor Xerox.
What follows are five reasons why HP might oppose the acquisition offer by Xerox. [...]
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mood · Nov 12, 2019

HP, Xerox have "major disagreements" on merger
November 12, 2019
https://www.crn.com.au/news/hp-xerox-have-major-disagreements-on-merger-533813

There are serious areas of disagreement between the leadership teams at HP Inc. and Xerox over the details of how the two companies would be combined, according to a report.

Sources told Bloomberg that both companies see a rationale for a merger, which would bring together the leaders in A4 and A3 devices at a time when the print industry is waning.
However, there are some major disagreements over the specifics—such as which company would be the acquirer in the deal and which of the two management teams would run the combined company, according to the report. Bloomberg characterised the issues as "potentially intractable disagreements."
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mood · Nov 17, 2019

HP Inc rejects Xerox deal, but happy to keep talking
November 18, 2019
https://www.crn.com.au/news/hp-inc-rejects-xerox-deal-but-happy-to-keep-talking-534109

HP Inc has rejected Xerox's proposed merger, but is open to a deal with a different structure..

News of the rejection came early this morning Sydney time when the HP Inc board issued a letter sent to Xerox Vice Chairman and CEO:John Visentin. The letter explained HP Inc feels the proposed deal is not the best thing for HP Inc and its shareholders.

"Our Board of Directors has ... unanimously concluded that it significantly undervalues HP and is not in the best interests of HP shareholders. [...]"
But the rejection was not definitive, as Bergh and Lores go on to say "We recognize the potential benefits of consolidation, and we are open to exploring whether there is value to be created for HP shareholders through a potential combination with Xerox."

And then the kicker: "We remain ready to engage with you to better understand your business and any value to be created from a combination."
All of which puts the ball in Xerox's court, as HP Inc has signaled it thinks consolidation of the printer market is a good idea and has enough balance sheet strength to make that happen without a Xerox deal.
By inviting Xerox to reveal more about its financial state, the letter leaves open the possibility that HP Inc could even acquire Xerox!
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ronjor · Nov 21, 2019

Xerox threatens to launch hostile bid for HP Inc

November 21, 2019
(Reuters) - Xerox Corp (XRX.N) on Thursday threatened to go hostile with its $33.5 billion buyout bid for HP Inc (HPQ.N), if the personal computer maker did not agree to a “friendly” discussion before Nov. 25.
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mood · Nov 26, 2019

Xerox will continue its attempt to take over HP by bidding directly to shareholders
November 26, 2019
https://www.neowin.net/news/xerox-w...e-over-hp-by-bidding-directly-to-shareholders

Over the past few days, printing company Xerox and HP have been in a back-and-forth. Xerox first approached HP with the intent to buy the company for $22 per share, for a total value of over $30 billion. HP's board of directors swiftly refused the proposal, citing, among other things, Xerox's declining revenue in the past year.

To Xerox's repeated dismay, HP's board of directors again refused to sell the company, and now, the former company has issued yet another letter to HP.
The letter goes on to present a series of reasons why Xerox believes HP's refusal to accept the offer doesn't make sense, such as the fact that HP's public disclosure says that past performance doesn't necessarily indicate future performance of a business.

It looks like HP might have a tough battle ahead, but it remains to be seen if Xerox's takeover plans will go through. HP has yet to respond to this new letter.
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mood · Jan 6, 2020

Xerox secures $24bn funding to acquire HP Inc
...but one of its main investors has been accused of insider dealing
January 6, 2020
https://www.computerweekly.com/news/252476287/Xerox-secures-24bn-funding-to-acquire-HP-Inc

It started out as a takeover bid valued at $33bn, and now Xerox has said it has secured funding of $24bn to acquire rival printer manufacturer HP Inc.
Xerox announced it had secured binding financing commitments from Citi, Mizuho and Bank of America to fund what it described as a “value-creating combination with HP”.

In a letter to HP Inc’s board, Xerox CEO John Visentin wrote: “Over the last several weeks, we have engaged in constructive dialogue with many of your largest shareholders regarding the strategic benefits of our proposal to acquire HP. [...]”
At the start of December, activist investor Carl Icahn wrote an open letter urging HP Inc to pursue negotiations with Xerox.

But now Icahn’s involvement in the Xerox/HP Inc deal is also under the spotlight, following a lawsuit brought against him from an institutional investor that own HP Inc shares, alleging insider trading. On 13 December, Bloomberg reported that the Miami Firefighters Relief and Pension Fund had filed a lawsuit claiming that Icahn’s business bought shares in HP Inc in the knowledge that Xerox would be putting in a bid for the company.
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mood · Jan 9, 2020

HP dismisses Xerox's $24 million financing commitment
HP says Xerox completely misunderstood why it's concerned about the proposed buyout
January 9, 2020
https://www.zdnet.com/article/hp-dismisses-xeroxs-24-million-financing-commitment/

HP said Xerox has completely missed the mark about addressing its key concern about the proposed buyout.
In a letter to Xerox vice chairman and CEO John Visentin, HP's board of directors wrote [...]

"Your letter dated January 6, 2020 regarding financing does not address the key issue -- that Xerox's proposal significantly undervalues HP -- and is not a basis for discussion," the letter said.

The letter said however, the company is still open to "pursuing the most value-creating opportunities" for HP shareholders.
"We reiterate that the HP board of directors' focus is on driving sustainable long-term value for HP shareholders," the letter said.
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ronjor · Jan 23, 2020

Xerox will attempt hostile takeover of HP's board of directors

By Natalie Gagliordi for Between the Lines January 23, 2020
Xerox said it plans to bring a full slate of new directors to HP's annual shareholder meeting in an attempt to overthrow HP's existing board via shareholder vote.
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mood · Feb 10, 2020

Xerox Raises Takeover Bid For HP To $24 Per Share
February 10, 2020
https://www.forbes.com/sites/sergei...x-raises-takeover-bid-for-hp-to-24-per-share/

After months of ongoing and increasingly tense merger negotiations between the two printing companies, Xerox announced on Monday that it would launch another bid to buy out HP, this time boosting its offer price to $24 per share—or around $34 billion in total.
Crucial quote: “The tender offer announced today will enable these [HP] stockholders to accept Xerox’s compelling offer despite HP’s consistent refusal to pursue the opportunity,” Xerox said in its announcement.
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mood · Feb 17, 2020

Xerox courts HP shareholders as takeover battle heats up
February 17, 2020
https://in.reuters.com/article/hp-m...ers-as-takeover-battle-heats-up-idINKBN20B03W

U.S. printer maker Xerox Holdings Corp (XRX.N) is hosting a dinner for HP Inc (HPQ.N) shareholders this week as it seeks investor support to overcome the personal computer maker’s resistance to its $35 billion takeover bid, according to people familiar with the matter.
Other such meetings are possible in the coming days, said another of the sources, who asked not to be identified because the meeting is confidential.

The printing industry is in decline as companies and consumers turn to digital documents to save money and help the environment. This has put pressure on companies in the sector to consolidate and reverse their revenue decline through acquisitions that can boost their market share.
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mood · Feb 21, 2020

Xerox Fires Back At HP’s ‘Poison Pill’ Plan To Slow Takeover Bid
February 21, 2020
https://www.forbes.com/sites/sergei...at-hps-poison-pill-plan-to-slow-takeover-bid/

Topline: After months of increasingly strained—and officially hostile— merger negotiations between the two printing companies, Xerox said on Friday that it would continue to pursue its acquisition of HP, despite the latter implementing a poison pill shareholder rights plan to shield against another takeover attempt.

Crucial quote: “Despite the HP board’s intention to deny shareholders the chance to choose for themselves, we will press ahead with our previously announced tender offer and electing our slate of highly qualified director candidates,” a Xerox spokesperson said on Friday.
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zapjb · Feb 21, 2020

What about HP's ink business that's the jewel. Maybe Xerox should go after that instead. $5,000+ a gallon woo woo.

mood · Feb 25, 2020

HP offers its investors billions in shareholder returns to avoid a Xerox tie-up
February 25, 2020
https://techcrunch.com/2020/02/25/h...-shareholder-returns-to-avoid-a-xerox-tie-up/

To ward off a hostile takeover bid by Xerox, which is a much smaller company, HP (not to be confused with Hewlett Packard Enterprise, a separate public company) is promising its investors billions and billions of dollars.
All investors have to do to get the goods is reject the Xerox deal.
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mood · Mar 2, 2020

Xerox makes official tender offer for HP at $24 per share
March 3, 2020
https://www.neowin.net/news/xerox-makes-official-tender-offer-for-hp-at-24-per-share

Last month, Xerox said it planned to make a tender offer for HP's outstanding shares, and today, it did exactly that. The tender offer values HP at $24 per share, $18.40 of which are in cash, and the remaining being equivalent to 0.149 Xerox shares for each HP share. With the offer, HP shareholders would get $27 billion in immediate cash, in addition to then owning a portion of Xerox shares.

John Visentin, CEO and vice-chairman of Xerox, commented on the proposal:

“Our proposal offers progress over entrenchment (...). HP shareholders will receive $27 billion in immediate, upfront cash while retaining significant, long-term upside through equity ownership in a combined company with greater free cash flow to invest in growth and return to shareholders.”
Xerox's offer is on the table until April 21, 2020, at 5PM Eastern Time, but Xerox says the deadline can be extended.
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Xerox: Xerox Launches Tender Offer to Acquire All Outstanding Shares of HP for $24 Per Share in Cash and Stock

Xerox Offer Provides Both Immediate Cash and Long-Term Value to HP Shareholders
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ronjor · Mar 5, 2020

HP rejects Xerox's raised takeover offer of $35 billion

March 5, 2020
(Reuters) - HP Inc (HPQ.N) on Thursday rejected Xerox Holdings Corp’s (XRX.N) raised takeover bid of about $35 billion, saying it undervalued the personal computer maker.
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mood · Mar 25, 2020

HP: No Time To Dialogue With Xerox During Pandemic
The PC and printer maker said it remains open-minded [...] but said 'now is not that time.'
March 25, 2020
https://www.crn.com/news/components-peripherals/hp-no-time-to-dialogue-with-xerox-during-pandemic

Amid the COVID-19 coronavirus pandemic, HP Inc. says that it cannot afford to divert attention in order to dialogue with Xerox, which has vowed to continue its hostile takeover bid.
Xerox said earlier this month that it is pausing its acquisition efforts in the wake of the coronavirus outbreak--which, among its many impacts, has led stock prices to plummet.

However, in a letter to shareholders that was posted online Wednesday, HP's leadership noted that Xerox has not dropped the bid altogether. Xerox “continues to advance its tender offer and its proposed slate of directors in an effort to force a combination,” HP said in the letter, signed by CEO Enrique Lores and Board Chairman Chip Bergh.

"It is important for shareholders to understand that, under these circumstances and consistent with our fiduciary duties, we believe that we should not divert valuable time, attention and resources to a dialogue with Xerox about its proposed transaction," HP said in the letter.
HP told shareholders that it is "committed to protecting your investment in HP," but that managing the impacts of the pandemic is the top priority right now.
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Xerox: Xerox Releases Statement Related to COVID-19 and its Proposal to Acquire HP (March 13, 2020)
HP: HP Issues Letter to Shareholders (March 25, 2020)

mood · Mar 31, 2020 at 5:44 PM

Xerox abandons $35 billion hostile bid for HP: sources
March 31, 2020
https://www.reuters.com/article/us-...lion-hostile-bid-for-hp-sources-idUSKBN21I3C0

Xerox Holdings Corp (XRX.N) decided on Tuesday to abandon its $35 billion hostile cash-and-stock bid for HP Inc (HPQ.N) after the coronavirus outbreak put the brakes on its takeover campaign, according to people familiar with the matter.

The decision came after Xerox said earlier this month it would postpone meetings with HP shareholders to focus on coping with the coronavirus pandemic. It is a blow to billionaire investor Carl Icahn, who owns big stakes in both companies and had pushed for their merger.
Xerox’s board concluded that pursuing the takeover without having access to HP’s books, so that it could assess the impact of the coronavirus pandemic on HP’s business, would be too risky, the sources said.
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Xerox: Xerox Provides Update on Proposal to Acquire HP

NORWALK, Conn. — Xerox Holdings Corporation (NYSE: XRX) (“Xerox”) today issued the following statement:

The current global health crisis and resulting macroeconomic and market turmoil caused by COVID-19 have created an environment that is not conducive to Xerox continuing to pursue an acquisition of HP Inc. (NYSE: HPQ) (“HP”). Accordingly, we are withdrawing our tender offer to acquire HP and will no longer seek to nominate our slate of highly qualified candidates to HP’s Board of Directors. [...]
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