Xerox has raised takeover offer for HP

The latest offer comprises $18.40 in cash and 0.149 Xerox shares for each HP share, valuing the company at about $35 billion.

Xerox said last month it plans to nominate 11 independent candidates to HP’s board and that it had secured $24 billion in financing for the offer. (REUTERS)

Xerox Holdings Corp raised its offer to buy HP Inc to $24 per share from $22 per share on Monday, following several rejections of its previous buyout offer by the PC maker.

The latest offer comprises $18.40 in cash and 0.149 Xerox shares for each HP share, valuing the company at about $35 billion.

The U.S. printer maker first made a $33.5 billion cash-and-stock offer for HP, a company more than three times its size, in November. HP's board had then rejected the offer, saying it significantly undervalued the company.

Shares of HP, which did not immediately respond to a request for comment, were up more than 5% at $22.86 in trading before the bell.

Xerox said last month it plans to nominate 11 independent candidates to HP's board and that it had secured $24 billion in financing for the offer.

In December, activist investor Carl Icahn, who has a 4.2% stake in HP and a 10.9% stake in Xerox, also urged HP shareholders who agreed to the merger to reach out to the PC maker's directors for immediate action.

The new offer from the imaging and copying giant is around 10 percent higher than the bid launched last year and rejected by the HP board of directors.

Xerox said in a statement it already has support from some large HP shareholders who "want the enhanced returns, improved growth prospects and best-in-class human capital that will result from a combination of Xerox and HP."

The statement added that its bid offers "immediate cash value, and meaningful upside via equity ownership in the combined company."

HP has called the Xerox bid too low and last month claimed the takeover bid is being driven by corporate raider Carl Icahn, who has a stake in Xerox.

"His large ownership position in Xerox means that his interests are not aligned with those of other HP shareholders," an HP statement said in January.

"Due to Mr. Icahn's ownership position, he would disproportionately benefit from an acquisition of HP by Xerox at a price that undervalues HP."

Xerox has said it was seeking to elect a new slate of HP board members that would support the takeover deal

The current HP was created by the 2016 breakup of Hewlett-Packard, leaving the HP consumer division making printers and PCs, spinning off HP Enterprise for cloud computing and servers.

(with inputs from AFP)