For those who came in late, Xerox has raised the cash to take over the much bigger HP.
HP has confirmed that Xerox is planning to nominate 11 candidates to stand for election to the Company’s Board of Directors at the HP’s 2020 Annual Meeting of Stockholders.
The maker of expensive printer ink claimed that the nominations are a self-serving tactic by Xerox to advance its proposal, that significantly undervalues HP and creates a meaningful risk to the detriment of shareholders.
“The HP Board of Directors is committed to serving the best interests of all HP shareholders and to pursuing the most value-creating path. Value creation for HP shareholders is not dependent on a Xerox combination. There are numerous opportunities available to HP to drive sustainable long-term value. These include the execution of HP’s strategic plan, and the deployment of its strong balance sheet for increased share repurchases of its significantly undervalued stock, and for value-creating M&A. Xerox’s proposed transaction attempts to use HP’s financial capacities for the benefit of Xerox shareholders.”
HP claimed that Xerox’s proposal and nominations are being driven by Carl Icahn, and his large ownership position in Xerox means that his interests are not aligned with those of other HP shareholders.
“Due to Icahn’s ownership position, he would disproportionately benefit from an acquisition of HP by Xerox at a price that undervalues HP. Icahn has meaningful influence over Xerox and its Board of Directors given this ownership position; the role he played in the appointment of Xerox’s current CEO, who is a former Icahn consultant; and the ties Icahn has to members of the Xerox Board, including Xerox’s Chairman, an Icahn employee”, claimed HP.