HP's logo at its headquarters in Palo Alto, California, the US. Picture: JOSH EDELSON / AFP
HP's logo at its headquarters in Palo Alto, California, the US. Picture: JOSH EDELSON / AFP

New York — Xerox says it will pause its pursuit of HP amid a global sell-off in the markets after the outbreak of the coronavirus.

“Xerox needs to prioritise the health and safety of its employees, customers, partners and affiliates over and above all other considerations, including its proposal to acquire HP,” Xerox CEO John Visentin said in a statement on Friday, adding that the company continued to monitor the situation closely.

Xerox intends to restart its pursuit of HP when markets stabilise, according to a person familiar with the matter, who asked to not be identified because the matter isn’t public. A representative for HP was not immediately available for comment.

Xerox’s shares have fallen about 33% over the past month while HP’s have fallen about 18%. Xerox was up 6.6% in pre-market trading Friday while HP rose 4.6%.

Xerox offered to acquire the much larger HP for $24 a share in cash and stock, or roughly $35bn, in a hostile takeover. It has also nominated a slate of directors to replace the company’s board. HP has repeatedly rebuffed its efforts, arguing the takeover price undervalues the company and has raised other issues with the proposal.

The printer maker said it would be forced to take a break from its hostile takeover and proxy fight in the wake of the pandemic.

“We believe it is prudent to postpone releases of additional presentations, interviews with media and meetings with HP shareholders so we can focus our time and resources on protecting Xerox’s various stakeholders from the pandemic,” Visentin said.

Dealmaking across the world is being hampered by the spread of the coronavirus. The volume of mergers and acquisitions announced to the end of February was down 27% to $419bn, the slowest start to a year since 2013, according to data compiled by Bloomberg.