Californian tech giant Hewlett-Packard turned down a $33 billion, approximately ₹2,36,469 crores acquisition bid from Xerox, maker of print and digital document products and HP’s rival. HP argued that the firm undervalued them.
HP said that in spite of all this, it would still like to discuss the possibility of reaching a deal with its competitor. Moreover, the deal would be taken into consideration if the fundamental questions of the company’s board members are addressed, according to HP.
HP said in a statement about the takeover bid, “We recognize the potential benefits of consolidation, and we are open to exploring whether there is value to be created for HP shareholders through a potential combination with Xerox.”
HP said that Xerox’s revenue dropped from $10.2 (approximately ₹73,088 crores) billion to $9.2 billion (approximately ₹65,923 crores) since June 2018. Seeing this, HP has a market value of $27 billion (approximately ₹1,93,467 crores).
“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,” HP said.
Citigroup Inc., the investment bank even agreed to give Xerox the funding to acquire HP. Xerox in its offer letter stated that it believes the industry is “overdue for consolidation and that those who move first will have a distinct advantage.” The Connecticut-headquartered firm eyes a future business model where 3D printing and textile printing bring in more revenue.
Xerox, known as Haloid when founded in 1906, pioneered photocopy machines and to add a fun fact, its name became a verb meaning in the US, where people used xerox when they needed to make a photocopy. Hewlett-Packard was one of the first Silicon Valle giants when in 2015 it was divided into enterprise products and services business, where it held onto the PC and printer businesses. It was then renamed HP Inc.