HP rebuffs latest Xerox approach


HP has issued a blunt response to Xerox’s latest approach, reiterating its position that Xerox’s hostile takeover proposal significantly undervalues HP.

Lores: proposal undervalues HP and "is not a basis for discussion"
Lores: proposal undervalues HP and "is not a basis for discussion"

Yesterday (8 January) HP chief executive Enrique Lores and chairman Chip Bergh sent a letter to Xerox CEO John Visentin, in response to Visentin’s communication at the beginning of this week stating that Xerox had secured $24bn (£18.3bn) in financing to effect the deal.

Xerox’s $33bn offer is for $22 per HP share, of which $17 would be in cash.

In the brief missive, Lores stated that the financing arrangement “does not address the key issue”.

He wrote: “We reiterate that the HP board of directors’ focus is on driving sustainable long-term value for HP shareholders. 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.”

Lores took over as CEO just two months ago.

HP’s share price went up by 1.31% yesterday, to $20.93. Xerox shares were $36.05 at the beginning of the week, and had slipped to $35.93 at the close of trading yesterday.

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