Xerox considers takeover offer for PC-maker HP

Yolanda Curtis
November 6, 2019

A takeover of HP by Xerox would bring together two of the most recognized names in the printing industry. In comparison, Xerox has an annual revenue of $10 billion, largely from renting and maintaining business machines, according to the Wall Street Journal. The board discussed the possibility Tuesday, and the company has an informal funding commitment from a major bank, the Journal reports.

Xerox is reportedly considering a bid to acquire HP a premium over the PC and printer vendor's $27 billion market value. Both companies are struggling to reinvent themselves as the need for printed documents dwindles, and are trying to cut their costs. The deal to buy Xerox's stake also includes 51 percent ownership in Xerox International Partners, an original equipment supplier in the United States and Europe, the companies said.

On Monday, Xerox had said it will sell its 25% stake in Fuji Xerox, its joint venture with Fujifilm Holdings 4901.T , for $2.3 billion, after investor activism scuppered a deal involving the two companies.

Palo Alto-based HP has for its part been facing a challenging market in recent years, as well as sudden changes of leadership. Xerox shares are up 84 percent this year, and its stock value rose five percent when the news broke about the Fujifilm deal. CEO John Visentin said on the company's earnings conference call that better cash flow would allow it to do more deals.

HP was spun out of Hewlett-Packard 2015 along with Hewlett Packard Enterprise Co., which makes computer servers and other data center equipment.

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