RESEARCH TRIANGLE PARK – Bank of America is one of three major investors that have agreed to help fund a possible takeover of tech giant HP by Xerox, according to a media report.
The Charlotte-based financial institution is one of three firms agreeing to fund a deal with up to $24 billion, the Wall Street Journal reports.
Other backers include Citigroup and Mizuho Financial Group, the WSJ reported Monday morning.
Xerox “has secured financing for its takeover offer for HP Inc.,” the report says, citing unnamed sources.
The compant is “is pushing forward with an unsolicited $33 billion bid that its larger rival has resisted,” the WSJ adds.
HP rejected a roughly $33.5 billion takeover offer from Xerox in November.
The Palo Alto, California-based company said that the cash and stock deal undervalues its business and its board cited concerns about “outsized” debt levels should the companies combine.
“Our Board of Directors has reviewed and considered your unsolicited proposal dated November 5, 2019 at a meeting with our financial and legal advisors and has unanimously concluded that it significantly undervalues HP and is not in the best interests of HP shareholders,” HP’s management wrote in a letter to Xerox.
“In reaching this determination, the Board also considered the highly conditional and uncertain nature of the proposal, including the potential impact of outsized debt levels on the combined company’s stock.”
HP, which makes computers and printers, said it recognizes the potential benefits of consolidation and remains open to exploring other options to combine with Xerox Holdings Corp. It is the world’s second largest PC manufacturer behind Lenovo.