HP Yet Again Rejects Xerox Takeover Offer -- Barrons.com
10:10 AM ET 1/9/20 | Dow Jones
By Eric J. Savitz
HP Inc. once again has rejected the $22-a-share unsolicited takeover bid from Xerox Holdings as too low.
Earlier this week, Xerox (ticker: XRX) announced that it has lined up financing for the cash portion of its offer for the rival printer company, which consists of $17 a share and the remainder in Xerox shares. But HP (HPQ) on Wednesday said its board continues to find the Xerox bid inadequate.
"We reiterate that the HP Board of Directors' focus is on driving sustainable long-term value for HP shareholders," HP CEO Enrique Lores and Chairman Chip Bergh wrote Wednesday in a letter to Xerox CEO John Visentin. "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 HP Board of Directors remains committed to advancing the best interests of all HP shareholders and to pursuing the most value-creating opportunities."
Xerox initially made the offer to HP in November, and HP has repeatedly rejected it as both too low and too risky given the substantial borrowings Xerox would require to complete the proposed transaction.
The question for Xerox is whether it is prepared to launch a proxy contest for control of the HP board ahead -- or to launch a hostile tender offer.
HP shares were up 0.6% in recent trading, at $21.06, after closing up 1.3% on Wednesday. The S&P 500 was up 0.5% in recent trading.
Write to Eric J. Savitz at eric.savitz@barrons.com
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January 09, 2020 10:10 ET (15:10 GMT)
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