Canon mortgages its relationship with HP in the event of a takeover by Xerox
In response to the official takeover offer from Xerox, HP’s board of directors continues to state that the proposed $ 35 billion understates its value. Through its CEO, Canon has declared in the press that it will stop supplying HP with components if the Xerox takeover bid is successful.
Unsurprisingly, HP again rejected the Xerox takeover offer, which Xerox made this time officially on March 3. As he had already expressed in the past, the manufacturer believes that the amount offered undervalues its value. Last month, Xerox had made a big effort to sweep the argument aside by raising its offer from $ 24 billion to $ 35 billion. “The Xerox offer would leave our shareholders with an investment in a new entity weighed down by an irresponsible level of debt. It would therefore demand unrealistic and unattainable synergies that would jeopardize all of its business, “said Chip Bergh, Chairman of the Board of Directors of HP. In addition, the latter did not fail to point the finger at the drop in sales of Xerox.
To this potential consequence of a merger between HP and Xerox would be added another, much less questionable as for it. In an interview with Asia Review, Fujio Mitarai, the CEO of Canon, said that if the takeover was successful, it would end the partnership between HP and the company he runs. For 35 years, Canon has supplied HP with the parts necessary to manufacture its laser printers.
But Canon is also a competitor to Xerox in the multifunction market. “This relationship [with HP] rests above all on the trust between the top managers of our two companies. At the same time, it involves a lot of exchange, established over time, from the point of view of technology, “said the director of Canon.