WSJ Article
In a bold move for two fading tech companies, Xerox seeks to claim the computer and printer manufacturer HP for an estimated 27 billion dollars. Xerox is approximately one third the size of HP, at around $8 bn market value. They are set to discuss matters on Tuesday. This comes as both companies are in "cost-cutting mode," with HP recently announcing that it would be cutting around 9,000 jobs by 2022. These two companies used to be much more househod names, but have failed to keep up with the new digital pace set forth by new cloud storage companies, especially hurting Xerox. I'm not sure this is a very good move for them, as they show no real sign of technological breakthroughs, and this is what as already been hurting them. We shall see how they get on.
HP and Xerox compete with each other in the printing industry, making household printers. With Xerox attempting to purchase HP they will be able to create a small monopoly with printers. Xerox, who's other main business venture is copiers, will gain HP's power of producing computers. $27 billion is a lot to pay considering the recent job cuts and struggling market, but this may allow for a tech giant to be created to corner the printer/copier market. My biggest concern is printers and copiers are likely to be non-existent soon, as our world is continuing to make progress to go paper-less.
ReplyDeleteElectronics will especially take a hit if additional tariffs are placed on the goods necessary for their products. HP may be taking a hit as a result of economic conditions which may be why they plan to cut so many jobs. This could be reason that HP goes through with this deal if they do.
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