https://www.theregister.co.uk/2019/12/09/xerox_presentation_hp_takeover/
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https://www.investopedia.com/ask/answers/05/retiredstock.asp
When Xerox and HP buy back shares they cancel the stock(as is the norm). Xerox canceled 12% of the total outstanding shares this year, HP canceled 9%. You can validate this by looking at the balance sheets for the companies under assists. It's not growing by their stock buybacks.
Companies only make money on stock issue (IPO or secondary offering). Stocks are not loans, but an ownership share.
To @12rzxXDc-3tuf
Apparently you do not know how stocks are treated. Stocks are loans. Companies sell stocks in order to raise money for their business. When they buy them back they have in reality paid back that loan. Just like paying back that loan on your house, you now own the house. In the business world buying back stock means you have less debt and own more of the company.
Buybacks make the stock disappear. Hp doesn't own hp stock nor does Xerox pay dividends to itself. Buybacks reduce supply and boost earnings per share. It's a waste of money and should be illegal (and almost was).
The IT transformation has been going on for more than 5 years. They were getting ready to implement a new OTC system back when I started over 25 years ago. About 15 years ago they chose Oracle for the US systems implementation & started putting together the schedule to complete the transition. There were some implementations over the years but the pace was slow & the results mixed. Obviously no company wide transformation. And so it continues...
I'm not expert but what I can read is a lot of 'pie in the sky' where do they get these numbers from?
I like the part about reducing IT systems and simplyfing, we have been trying (and failing) to do this for the past 5 years! cut vendors = supply chain nightmare, loss of office space = outsourcing to incompetent companies ..All I can see is lots of people laid off, customers leaving due to poor service and steep revenue declines ( xrx will destroy what HP is left) so all in all investors will win and run.I just hope i get a package.
Good luck with the revenue synergies - we bought ACS based on all the cross selling that was going to happen. They will be to fire folks, outsource to HCL, cut benefits, etc but there is no chance in hell that they will generate revenue synergies, especially not with this band of crooks!
Check out slide 14. No savings yet, nor for months even years. Tossed employees over to HCL to state how great Xrx is at transformation. It is a failing mess.
Keep in mind that HP has bought back a large portion of stock shares over the past 1-2 years due to the Trump tax cut for corporations. That means that HP owns a lot of HP. The largest holder of shares that is not HP is Vangard at 8%. Icahn only holds 4%.
Icahn is barking up the wrong tree with his pursuit of HP.
No doubt, the presentation slides are impressive and promise a substantial "payoff" for HP shareholders, if they go along with the proposed takeover by Xerox. However, my sense is the principals at Xerox have an abbreviated time horizon. Once their stock holdings reach a certain level, they WILL cash out and abandon the company entirely. Then the remaining board members will have to select new leaders to clean up the mess left behind. Can a Xerox/HP merger return us all to the extraordinary "greatness" that is being suggested in this presentation? It's a remote possibility but we will need new leaders with a vision for the long term viability of our business.