The aborted takeover deal between Xerox and HP may be back on track.
HP’s board of directors rejected Xerox’s bid to acquire the company in November last year, but the company now wants the two parties back on the discussion table following the news that Xerox has received US$24 billion in funding commitments for the acquisition.
In a statement on Monday, Xerox confirmed it had written to the board of directors of HP confirming binding financing commitments from Citi, Mizuho and Bank of America to complete its value-creating combination with HP.
The letter, signed by John Visentin, vice-chairman and CEO of Xerox, reads: “Over the last several weeks, we have engaged in constructive dialogue with many of your largest shareholders regarding the strategic benefits of our proposal to acquire HP.
“It remains clear to all of us that bringing our companies together would deliver substantial synergies and meaningfully enhanced cash flow that could, in turn, enable increased investments in innovation and greater returns to shareholders.”
Aurojyoti Bose, lead analyst at GlobalData, a data and analytics company, says Xerox has managed to resolve the major sticking points that had railroaded the proposed transaction. “After months of uncertainty, Xerox has moved towards its acquisition bid for HP. Xerox has confirmed US$24 billion funding commitments from Citi, Mizuho and the Bank of America, thereby putting an end to doubts regarding Xerox’s ability to raise the…