(Information) – Activist investor Carl Icahn has purchased a $1.2 billion stake in HP Inc (HPQ.N) and is pushing for the private laptop maker’s merger with printer maker Xerox Corp (XRX.N), arguing that a union might yield large earnings for buyers, the Wall Road Journal reported on Wednesday.
FILE PHOTO: Billionaire activist investor Carl Icahn offers an interview on FOX Enterprise Community’s Neil Cavuto present in New York February 11, 2014. Information/Brendan McDermid
Icahn, who owns a 10.6% stake in Xerox, now owns a four.24% stake in HP, the Journal mentioned here
Xerox made a roughly $33 billion cash-and-stock provide for HP, an organization greater than 3 times Xerox’s dimension, Information reported final week. HP confirmed the bid, however has not disclosed the provide worth.
“I feel a mix is a no brainer,” Icahn was quoted as saying by the Journal.
“I imagine very strongly within the synergies,” he mentioned, including that “there’ll most likely be a selection between money and inventory and I’d a lot quite have the inventory, assuming there’s a great administration staff.”
Xerox believes it may possibly obtain at the very least $2 billion in annual value synergies by creating an workplace know-how provides big, one supply advised Information final week.
The billionaire advised the Journal that his staff started taking a look at HP in late February and he purchased the corporate’s shares from late April to mid-August, although he didn’t have a take care of Xerox in thoughts when he began accumulating the shares.
Icahn mentioned he believes a mixed firm is in one of the best pursuits of each units of shareholders given the potential for value financial savings and to market a extra balanced portfolio of printer choices, the WSJ reported.
This isn’t the primary deal that Icahn has tried to orchestrate by having a small firm purchase an even bigger one.
In June, U.S. on line casino operator Eldorado Resorts Inc (ERI.O) agreed to amass bigger peer Caesars Leisure Corp (CZR.O) for $17.three billion, together with debt. Icahn had earlier gained seats on the board of Caesars.
Icahn, HP, and Xerox didn’t instantly reply to Information requests for remark late on Wednesday.
Reporting by Maria Ponnezhath and Anurag Maan; Modifying by Subhranshu Sahu and Shailesh Kuber