Citing health concerns caused by the novel coronavirus, Xerox Holdings Corp.
"In light of the escalating COVID-19 pandemic, Xerox needs to prioritize the health and safety of its employees, customers, partners and affiliates over and above all other considerations, including its proposal to acquire HP," CEO and vice-chairman John Visentin said of the decision to halt the takeover bid.
"As we closely monitor reports from government and healthcare leaders across the globe and work with colleagues in the business community to minimize the spread and impact of the virus," Visentin continued, "we believe it is prudent to postpone releases of additional presentations, interviews with media and meetings with HP shareholders so we can focus our time and resources on protecting Xerox's various stakeholders from the pandemic."
HP, meanwhile, has declined to comment on Xerox's announcement.
"In these uncertain times our priority is to stay focused on our shareholders, partners, customers and employees," an HP spokesperson told The Register. "We won't comment on Xerox's statement other than to say we remain focused on acting in the best interests of our communities."
Xerox began their takeover attempt last November. They have made several offers that have been rejected; the most recent was a bid of $35 billion that HP said was too low. Xerox is significantly smaller than HP bringing in an average of $9.8 billion in yearly revenue. HP, on the other hand, raked in nearly $60 billion in 2018 alone. While the benefit to Xerox is clear, HP has argued that its customers would see little benefit.
"At HP, we're creating value, not risk," HP CEO Enrique Lores said in mid-March. "HP is a trusted brand with a strong track record of value creation and we're executing a clear plan that will drive significant earnings growth."
Of course, the decision to halt the purchase comes amid increasing market volatility. In the past month, HP's stocks have fallen to under $17 from a high of $23.52, and Xerox's share price dropped from $33.50 to $22.47. Xerox has denied that these stock declines had anything to do with their recent decision.
"For the avoidance of doubt, Xerox does not consider the market decline since the date of its offer or the temporary suspension of trading in HP shares that occurred on March 10, 2020 and March 12, 2020 as a result of market-wide circuit breakers procedures to constitute a failure of any condition to its offer to acquire HP," the Xerox said.
