Xerox secures funding for HP bid

Xerox has picked up $24 billion of financing from Citi, Mizuho and Bank of America in order to help it press ahead with the hostile takeover of HP that it announced last month.

Xerox’s Webster research Centre, near Rochester, New York in the USA.

According to Bloomberg, this financing is a bridge loan that comes in two parts, with $19.5 billion available for 364 days, which is expected to be syndicated, and a further $4.5 billion available for 60 days that is meant to be replaced by cash on HP’s balance sheet. 

John Visentin, vice chairman and CEO of Xerox, has sent another letter to HP’s board of directors, stating: “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.”

Xerox has offered HP shareholders $22 per share, which values HP at $33.5 billion. HP’s directors have previously written: “In particular, there continues to be uncertainty regarding Xerox’s ability to raise the cash portion of the proposed consideration and concerns regarding the prudence of the resulting outsized debt burden on the value of the combined company’s stock even if the financing were obtained.”

Visentin addresses this directly in his letter, stating: “We have always maintained that our proposal is not subject to a financing contingency, but in order to remove any doubt, we have obtained binding financing commitments (that are not subject to any due diligence condition) from Citi, Mizuho and Bank of America.”

Visentin concludes his letter with an offer “to meet with you in person, with or without your advisors, to begin negotiating this transaction.” No doubt we’ll get HPs reaction in due course. 


Subscribe to this site:
You can sign up to follow Graphics to Industrial Printing Journal to be notified of future posts.


Posted

in

, ,

by

Syndicate content

You can license the articles from Printing and Manufacturing Journal to reproduce in other publications. I generally charge around £150 per article but I’m open to discussing this for each title, particularly for publishers that want to use multiple stories. I can provide high res versions of images for print publications.

I’m used to working with overseas publishers and am registered for VAT with the UK’s HMRC tax authority but obviously won’t charge VAT to companies outside the UK. You can find further details and a licensing form from this page, or just contact me directly here.

Support this site

If you find the stories here useful then please consider making a donation to help fund Printing and Manufacturing Journal, either as a one-off or a repeat payment. Journalism is only really useful if it’s truly independent and this is the only such news source serving the print/ manufacturing sectors.

However, there are costs involved in travelling to cover events, as well as maintaining this site, not to mention the time that it takes to carry out research, check facts and interview people. So if you value this work, then please help to maintain it and keep it free to read.

Subscribe

Never miss a story – subscribe to Printing and Manufacturing Journal to receive an email notification every time an article is published here. It’s completely free of charge and you can cancel the subscription at any point without any hassle. There’s no need to provide any information other than an email address and subscribers details are not for sale so there’s no risk of any further marketing spam.

Related stories

Comments

Leave a Reply

Your email address will not be published. Required fields are marked *