Xerox threatens (again) to take its HP Inc buyout offer direct to shareholders

'Your refusal to engage in mutual due diligence with Xerox defies logic,' Xerox CEO John Visentin tells HP Inc

Xerox has announced plans to go hostile in its bid for PC and printer maker HP Inc, taking its $33.5 billion buyout bid direct to shareholders.

In an open letter to the company on Tuesday, Xerox CEO John Visentin said that HP's "refusal to engage in mutual due diligence with Xerox defies logic".

He described Xerox's takeover offer as "a compelling proposal", pitching it squarely in terms of what HP shareholders would get out of a merger between the two companies: a cash sum combined with a 50 per cent share of the enlarged company. He also claimed that the combined company would continue to enjoy an investment-grade credit rating.

"We plan to engage directly with HP shareholders to solicit their support in urging the HP Board to do the right thing and pursue this compelling opportunity," wrote Visentin, who also claimed that HP shareholders had contacted him to lend their support to the proposal.

In a letter dripping in condescension, Visentin added: "Rather than engage with us in three weeks of customary mutual due diligence, HP continues to obfuscate and make misleading statements."

He continued: "While you may not appreciate our ‘aggressive' tactics, we will not apologise for them. The most efficient way to prove out the scope of this opportunity with certainty is through mutual due diligence, which you continue to refuse, and we are obligated to require."

The two companies had been in talks for some time regarding a potential merger before Xerox went public earlier this month with a formal offer. HP is three times the size of Xerox and rejected the copier maker's bid. It added that it was ready to explore a combination if Xerox provided due diligence information to HP, although ultimately would be open to a raised offer.

However, despite activist investor Carl Icahn coming out in favour of the deal - his organisations hold a 10.6 per cent stake in Xerox and a 4.24 per cent stake in HP - HP has continued to rebuff overtures from Xerox's board.