Why Xerox (Still) Isn't Convincing HP Shareholders
Following through on promise/threat it made back in November, struggling photocopier company Xerox (NYSE: XRX) finally took its acquisition case directly to HP (NYSE: HPQ) shareholders last week, rather than continuing to try and negotiate with HP's stubborn board of directors. The so-called hostile takeover attempt now underway is rooted in the belief that the computer and printer brand's investors are more interested in the offer than HP's board suggests.
Perhaps that is indeed the case. If they're really hoping for a merger though, HP's crowd of investors has been strangely quiet on the matter despite plenty of opportunities to voice their wishes to the board of directors.
It may not be the price that's holding them back. There's little doubt that combining the companies will improve efficiency, either. Arguably, any holdup may actually reflect the lack of a compelling argument that these two companies -- once combined -- can do anything other than slow their own demise. Xerox needs to show HP's shareholders something with a "wow factor" that can only be realized by melding the two organizations into one.
Source Fool.com