HP Inc.’s board unanimously rejected Xerox Holdings Corp.’s unsolicited takeover offer, saying the $22-a-share offer is too low. It cited concerns about Xerox’s prospects.
HP Chief Executive Enrique Lores and Chairman Chip Bergh, in a letter to Xerox CEO John Visentin, said that the company is “open to exploring” a merger, but that there are “fundamental questions that need to be addressed.” They cited Xerox’s revenue decline since June 2018, “which raises significant questions for us regarding the trajectory of your business and future prospects.”
HP’s statement included a Nov. 5 letter from Xerox outlining the offer of $17 a share in cash and 0.137 of a Xerox share for each HP share, for a total transaction value of $33.5 billion. Xerox’s letter said the offer remained open until Nov. 13. HP said its board made its decision the day it received Xerox’s letter.
HP said it’s still open to discussing a merger.
“With substantive engagement from Xerox management and access to diligence information on Xerox, we believe that we can quickly evaluate the merits of a potential transaction,” Lores and Bergh wrote.
“We remain ready to engage with you to better understand your business and any value to be created from a combination,” they added.