- Xerox has made a cash-and-stock offer for personal-computer and printer maker HP, CNBC confirmed on Wednesday.
- The company's board discussed the possibility on Tuesday, according to a report by The Wall Street Journal, which said Xerox has an informal funding commitment from a major bank.
- Xerox, which makes printers and copiers, has a market cap of $8.05 billion, less than a third of HP's $27.27 billion market value.
Xerox has made a cash-and-stock offer for personal computer and printer maker HP, CNBC has confirmed.
As both companies look to cut costs, sources said combining the companies could save more than $2 billion in expenses, CNBC's David Faber reported.
Should the deal come together, the combined company's debt would remain investment grade.
The company's board discussed the possibility on Tuesday and Xerox has an informal funding commitment from a major bank, according to The Wall Street Journal, which first reported the story.
Xerox, which makes printers and copiers, has a market cap of $8.05 billion, less than a third of HP's $27.27 billion market value.
HP on Wednesday confirmed it has held talks with Xerox about a possible deal.
"We have considered, among other things, what would be required to merit a transaction. Most recently, we received a proposal transmitted yesterday," the company said in a statement. "We have a record of taking action if there is a better path forward and will continue to act with deliberation, discipline and an eye towards what is in the best interest of all our shareholders."
Representatives from Xerox did not respond to CNBC's emailed request for comments.
Last month, HP said it will cut between 7,000 and 9,000 jobs by the end of fiscal 2022 as part of a broader restructuring plan that it estimates will save $1 billion a year. That would amount to almost 16% of its 55,000 employees worldwide, according to FactSet.
HP was created after Hewlett-Packard separated its enterprise business — Hewlett Packard Enterprise — that sells data storage equipment, servers, and other related services.
Xerox said on Tuesday it will sell its 25% stake in Fuji Xerox, the joint venture between the company and Japan's Fujifilm, for $2.3 billion. Investor activism stopped a deal in 2018 that would've merged Xerox into Fuji Xerox and given Fujifilm control, Reuters reported.
–CNBC's Annie Palmer contributed to this report.