According to a report from the Wall Street Journal Xerox is considering an acquisition of HP.
According to the sources close to the matter, Xerox’s board held a meeting last night to discuss the potential deal as the acquisition will be one of the biggest considering HP currently trading at a market value of $27 billion. While there’s no guarantee that Xerox will make a former offer, the report claimed that Xerox has received a formal funding assurance from a major bank.
The latest report doesn’t come off as a major surprise. HP Inc, previously known as Hewlett-Packard, went through major problems over last couple of years due to increased competitions. Back in 2015 it went through a demerger to separate its PC and Printer business under new name of HP Inc while the enterprise business was renamed Hewlett Packard Enterprise.
Since then, the company has been struggling with its printer business as the division experienced five percent drop in revenue for the third quarter this year compared to the same time period from 2018. Earlier last month, the company revealed its plans to cut down up to 9,000 jobs as a part of a restructuring program.
While we will have to wait to see how the acquisition unfolds, WSJ claimed that Xerox believe it can generate up to $2 billion in annual cost savings for Xerox. At the moment it’s unclear how Xerox intends on achieving the goal. As the company has struggled in recent years due to increased popularity of cloud computing and internet services, the acquisition is an interesting prospect nevertheless.