Xerox went to the shareholders of PC and printer manufacturer HP with a new bid for the company. According to Mercury News, on Monday Xerox held a presentation for HP shareholders, in which it offered $17 per share and half of the shares of the resulting merged company.

HP’s board had previously refused an offer from hardware company Xerox. Xerox, which is much smaller than the PC manufacturer, underestimated the value of HP according to the board.

Nevertheless, Xerox is trying again, this time by urging HP’s shareholders to put pressure on the board. Xerox expects that a share in the merged entity which would result from the acquisition would be worth some $31, significantly more than the $20 that a shareholding in HP currently yields.

Xerox expects strong growth

Printer and copier manufacturer Xerox predicts shareholders’ sales growth of $1.5 billion to $1.5 billion in three years. In addition, Xerox expects to add another $3 billion in cost savings to the value of both companies.

According to Xerox, the acquisition would be a good way to overcome the economic pressure of a slow-growing printer market. The company already has the support of investor Carl Icahn, who owns four percent of HP and eleven percent of Xerox.

Xerox’s initial offer was around $33.5 billion, $17 per share and 0.137 Xerox shares per HP share. That amounted to $22 per share in value, which the HP board considers to be too little.

HP doesn’t want to go ahead

Several analysts tell Mercury News that they don’t expect HP to go along with the new bid. Moreover, HP’s board sees Xerox’s strategy as far too aggressive and downright “hostile”.

Xerox calls HP’s attitude “completely illogical”. Moreover, the board of HP would make “misleading statements”.