Xerox Holdings Corp. opened a new front in its takeover bid of HP Inc. with a plan to nominate 11 directors to the HP board.
Xerox initiated an unsolicited $33.5 billion acquisition bid for HP in November, but the leadership of the Palo Alto, California-based HP has repeatedly rejected the takeover overtures. This effort follows a vow by Xerox CEO and Vice Chairman John Visentin to take the case of acquisition directly to the HP shareholders.
“HP shareholders have told us they believe our acquisition proposal will bring tremendous value, which is why we lined up $24 billion in binding financing commitments and a slate of highly qualified director candidates,” Visentin said. “We believe HP shareholders will be better served by a new slate of independent directors who understand the challenges of operating a global enterprise and appreciate the value that can be created by realizing the synergies of a combination with Xerox.”
Xerox noted that its nominees include former senior executives from major corporations including Aetna, United Airlines, Hilton Hotels, Novartis and Verizon. Absent from the list is Carl Icahn, a Xerox director and the Norwalk-headquartered company’s largest shareholder. Icahn owns a 4.24% share in HP, making him the company’s fifth largest shareholder. However, the Miami Firefighters Relief and Pension Fund filed a lawsuit last month against Icahn for allegedly buying HP stock during mid-2019 with advance knowledge that Xerox would be pursuing an acquisition bid.
An HP spokesperson responded to Xerox’s announcement with a press statement that read, “These nominations are a self-serving tactic by Xerox to advance its proposal, which significantly undervalues HP and creates meaningful risk to the detriment of HP shareholders.”