Xerox has dropped its bid to merge with HP, citing the current global health crisis related to the COVID-19 coronavirus, Xerox said. The news was previously reported by the Wall Street Journal.
“The current global health crisis and resulting macroeconomic and market turmoil caused by COVID-19 have created an environment that is not conducive to Xerox continuing to pursue an acquisition of HP Inc,” Xerox said in a st atement on Tuesday.
Xerox had previously led a hostile takeover bid of HP which would combine the two legendary tech giants. HP had rejected Xerox’s proposals. In February, Xerox raised its offer to $24 per share, which would value HP at about $34 billion.
However, since Xerox sweetened its bid, the COVID-19 coronavirus outbreak spread around the world and has created economic uncertainty, which led to Xerox ceasing its pursuit of the transaction. HP is a larger company and is more highly valued than Xerox.
HP announced last year that it planned to cut between 7,000 and 9,000 jobs by the end of 2022 to save $1 billion per year. In February, Xerox said that it had met with HP’s shareholders to discuss the potential “synergies” from a combination.
HP shares dropped more than 1% after hours on the news, while Xerox shares barely moved after rising more than 5% during regular trading.
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