HP Inc. said it has rejected an unsolicited takeover offer from Xerox Holdings Corp. and has asked shareholders not to tender their shares.
The $34 billion offer “meaningfully undervalues HP and disproportionately benefits Xerox shareholders,” the Palo Alto, California-based company said in a statement on Thursday. Xerox’s “urgency” in launching the offer shows its “desperation to acquire HP to address its continued business decline.”
Xerox has pitched HP investors on a cash-and-stock offer worth $24 a share. For each HP share, a holder would receive $18.40 in cash and 0.149 Xerox shares. The offer is set to expire April 21, Norwalk, Connecticut-based Xerox said Monday in a statement.
HP, which has a large printing business, has said in the past that it has many routes to create value that aren’t dependent on a combination with Xerox. Chief Executive Officer Enrique Lores is still new to HP’s top job, and has sought to make his mark on a company he’s worked at for more than three decades. Lores wants to make printing services, 3-D printing and high-end computers a larger part of HP’s business, and would oversee as much as a 16% reduction in the company’s workforce in a bid to cut costs.
Xerox CEO John Visentin has criticized this plan as a piecemeal approach that won’t be as beneficial to HP as a combination.
More must-read stories from Fortune:
—Coronavirus spreads to a previously healthy sector: corporate earnings
—A Fed rate cut won’t cure what’s ailing the stock market
—How companies like Ernst & Young are going to extremes to avoid infections
—These cities have the most jobs with six-figure salaries
—Credit Karma was acquired rather than pursuing an IPO. Will more companies follow suit in 2020?
Subscribe to Fortune’s Bull Sheet for no-nonsense finance news and analysis daily.
