The developing saga of the potential merger between office equipment giants Xerox (NYSE: XRX) and Hewlett Packard (NYSE: HPQ) has taken another turn after a previous failure on Xerox's part. After a deal fell through because of concerns over financing, Xerox has come back with secured financing and is attempting a hostile takeover HP. Multiple times now, HP has tried to scuttle Xerox's attempts to buy out the eminent manufacturer of printers and copiers, but Xerox is still insistent. The CEO of Xerox, John Visentin, had this to say: "In order to remove any doubt, we have obtained binding financing commitments. My offer stands to meet with you in person, with or without your advisors, to begin negotiating this transaction."
The most recent bid that Xerox is placing to take over HP is valued at roughly $33 billion, and several banks from around the world have contributed to this total. Bank of America (NYSE: BAC) and Citigroup (NYSE: C) are among the banks that have offered institutional funding for this buyout, along with several international partners. As a result of this recent news, Xerox stock is sitting near a 5 year high, although in recent days, the share price has taken a slight hit due to setbacks in the HP buyout. Two times now, the board of directors of HP has rejected the buyout bids, calling the offers a significant undervaluation both times.
Xerox has appealed to shareholders of HP to nominate new directors for the merged company. This process was opened up on Christmas Day and is expected to last roughly one month. According to an analyst following this merger closely, either Xerox or activist investor Carl Icahn is expected to play a major role in selecting the new board for the merged company. Icahn has taken fire recently, being the target of a lawsuit from an investor who alleges that he bought stock in both companies in advance of the bid.