HP rejects the Xerox buyout offer for now. The company is not ready to lose its independence yet. A Xerox proposal for HP buyout was $22 per share. However, the tech pioneer thinks the offer undervalues HP. Considering Xerox’s revenue and debt, the tech pioneer doubts the ability of Xerox to complete the deal in the first place. HP sent a detailed letter to the CEO of Xerox saying the offer undervalues HP and is not in the best interest of HP stakeholders. Also, HP is confident about its strategies to sustain long-term values.
However, HP is open to a better deal. According to them, substantive engagement from executives and access to relevant information could help Xerox to build a better deal. HP is against being acquired; however, it does want to know the better deals that would make sense. HP has been working on building a smart printer that will allow users to print from anywhere. Its printers have Alexa and Google assistant association to fire a print command. Carl Icahn, who recently purchased a $1.2 billion stake in HP, thinks that the HP-Xerox merge could save the money. He says HP and Xerox combined will thrive in the printer world.
HP right now has reasons to both give in and hold out for a little longer. It recently announced to reduce the 16 percent of its jobs until 2022. They are planning to cut out 9000 jobs from their current headcount. HP strongly believes in its management plans to take the company forward. They have faced many ups and downs. Still, HP wants to try more. Selling the shares to Xerox will be the End of an Era for Silicon Valley’s oldest company. HP does not want to lose control over its future and destiny. Hence, they are rejecting any buyout offers.