Xerox on Monday turned the heat up in its efforts to acquire HP, as the printing technology giant raised its unsolicited offer for the Silicon Valley stalwart to $34 billion.
Xerox said it will now offer $24 a share for HP, which will include $18.40 in cash and 0.149 Xerox shares for every share of HP stock. Xerox said it will take its new bid public with a tender offer for HP’s shares starting “on or around March 2.”
HP has so far turned down all of Xerox’s efforts, in part because it believes Xerox has consistently undervalued HP with its offers. Xerox said it is making its latest offer after meeting “in some cases multiple times with HP’s largest shareholders” in order to assure that its proposal provides more-than-adequate value to HP.
“The value created by the synergies realized in a combination of Xerox and HP is incremental to any value that HP can create by revising its strategic plan or dramatically changing its capital allocation policy to incorporate additional share repurchases,” Xerox said in a statement about its latest offer. “Xerox’s offer provides HP stockholders with both significant, immediate cash value, and meaningful upside via equity ownership in the combined company.”
HP didn’t immediately return a request for comment.
Xerox’s offer is the latest chapter in what has been a three-month-long acquisition saga. Xerox brought its first proposal to HP in November, and the situation heated up with the involvement of billionaire activist investor Carl Icahn, who in November revealed he owns 4.24% HP’s stock, in addition to a 10.6% stake in Xerox. Icahn said a Xerox-HP combination would be a “no-brainer.”
HP has summarily rejected every Xerox buyout offer. In January, Xerox followed through on its earlier threats and said it would nominate a slate of 11 proposed directors to HP’s board at that company’s next annual shareholders meeting. HP has yet to set a date for its shareholders meeting this year, but it has historically held such meetings in April.