Xerox makes fresh $35bn offer for HP
Xerox today made a fresh offer to buy HP valuing the company at about $35bn (£27bn) after its previous takeover approach was rejected.
Xerox increased its offer to $24 per share from $22 per share.
The latest offer comprises $18.40 in cash and 0.149 Xerox shares for each HP shares, valuing the company at about $35bn.
Xerox first made a $33.5bn cash-and-stock offer for HP, which is more than three times its size, in November.
HP’s board rejected the offer saying it significantly undervalued the company.
HP shares rose two per cent in early trading to $22.16.
Xerox said it had met with many of HP’s largest shareholders.
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.”
And added: “The tender offer announced today will enable these stockholders to accept Xerox’s compelling offer despite HP’s consistent refusal to pursue the opportunity.”
Xerox said last month it plans to nominate 11 independent candidates to HP’s board and that it had secured $24bn in financing for the offer.
In December, activist investor Carl Icahn who has a 10.9 per cent stake in Xerox and a 4.2 per cent stake in HP, urged HP shareholders to persuade the company’s directors to back the deal.
HP previously accused Xerox of using “aggressive words and actions” to force through a deal without providing adequate information.
The printer-maker hit back, saying: “While you may not appreciate our ‘aggressive’ tactics, we will not apologise for them.”
The proposed takeover came after Xerox sold off its $2.3bn stake in Fuji Xerox, bringing to an end a potentially ruinous legal battle with Fujifilm.
Citi is acting as Xerox’s financial adviser, and King & Spalding is providing legal counsel to Xerox. Willkie Farr & Gallagher is providing legal counsel to Xerox’s independent directors, and Moelis & Company is acting as financial adviser to Xerox’s independent directors.
HP was contacted for comment.