Xerox (XRX) - Get Report said Friday that it was postponing its activities related to its $35 billion hostile takeover bid for HP Inc. (HPQ) - Get Report out of concern about the coronavirus pandemic.
John Visentin, Xerox vice chairman and CEO, said in a statement that "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.”
"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.”
Xerox was trading down 5.8% to $22.512, while shares of HP Inc. were off 3.1% to $16.97
Xerox said that it didn't consider the market decline since the date of its offer or the temporary suspension of trading in HP shares that occurred on March 10 and March 12 as a result of market-wide circuit breakers procedures "to constitute a failure of any condition to its offer to acquire HP."
“In these uncertain times our priority is to stay focused on our shareholders, partners, customers and employees," an HP spokesperson said. "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 said earlier this month that it was prepared to pay $24 in cash and shares, up from its original bid of $22 in late November, to buy Palo Alto, California-based HP. Xerox has also vowed to name 11 independent candidates to replace HP's board at its next annual meeting as the two side sparred over the value of the bid and the future of each company.
At that time HP Chairman Chip Bergh said that "our message to HP shareholders is clear: the Xerox offer undervalues HP and disproportionately benefits Xerox shareholders at the expense of HP shareholders.”