Xerox says it’s postponing activities related to its $US35 billion hostile takeover bid for HP because of the coronavirus pandemic. Earlier this month, HP rejected the increased offer, saying it undervalued the company.
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| "It is prudent to postpone'; Xerox CEO John Visentin |
“In light of the escalating COVID-19 pandemic, Xerox needs to prioritize the health and safety of its employees, customers, partners and affiliates over and above all other considerations, including its proposal to acquire HP,” said John Visentin, Xerox vice chairman and chief executive officer in a statement issued from the company’s headquarters in Connecticut.
“As we closely monitor reports from government and healthcare leaders across the globe and work with colleagues in the business community to minimize the spread and impact of the virus, we believe it is prudent to postpone releases of additional presentations, interviews with media and meetings with HP shareholders so we can focus our time and resources on protecting Xerox’s various stakeholders from the pandemic.”
The statement continued: “For the avoidance of doubt, Xerox does not consider the market decline since the date of its offer or the temporary suspension of trading in HP shares that occurred on March 10, 2020 and March 12, 2020 as a result of market-wide circuit breakers procedures to constitute a failure of any condition to its offer to acquire HP. Xerox will take the same view on any future temporary trading halts, unless otherwise stated in advance.”
Earlier this month, HP rejected an increased $35 billion takeover offer from Xerox Holdings, saying it undervalued the company and was not in the best interests of shareholders.
The offer showed Xerox’s “desperation…to address its continued business decline," said HP's board, adding: “Xerox does not have experience operating businesses in the sectors in which HP operates, including within Personal Systems, Home Printing, and 3D and Digital Manufacturing.”
“Xerox is essentially offering HP shareholders something they already own,” HP said in a statement. The offer “meaningfully undervalues HP and disproportionately benefits Xerox shareholders” and would "create an irresponsible capital structure, resulting in significant risks for HP shareholders."
