Hewlett Packard sets a barrier to protect itself from hostile takeover
HP Inc has put up a protection structure against a hostile takeover by industry counterpart Xerox. The American computer and printer manufacturer has been resisting the approaches of copier manufacturer for some time.
The protective structure takes effect if a shareholder acquires an interest of more than 20 percent in HP without the permission of the board. In that case, the remaining shareholders automatically get more control and receive more dividends.
According to HP, the protection structure is not intended to block an acquisition by Xerox. It is a means to encourage the copier to negotiate an “appropriate price” with the HP administration. Xerox, which already has a small stake in HP, wants to replace the current board of HP and has already come up with a list of eleven new directors.
Xerox recently increased its HP offer to $ 24 per share. HP promised to respond to this next week. “Xerox is a threat because it is trying to take over us in a hurried and aggressive way,” said HP CEO Chip Bergh.