Xerox Offers HP Inc. $22 a Share to Take Over the PC, Printing Giant: Report

Xerox is reportedly offering HP Inc. $22 per share as part of its proposed plans to take over the personal computer and printing giant.

The latest development, reported by CNBC according to unnamed sources, would result in $2 billion in “cost synergies” between the two companies that have struggled in recent years as businesses and consumers continue to spend less money on printers and copy machines.

HP confirmed on Wednesday that it received a proposal from Xerox about a possible business combination, but did not cite specific financial details.

“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,” the statement read.

The deal is unusual considering HP is the larger company with a market capitalization of nearly $30 billion, dwarfing Xerox’s market cap of $8 billion. But, the Wall Street Journal reported that Xerox has received “an informal funding commitment from a major bank,” that would presumably help in its takeover bid.

Analysts at research firm CFRA cited the “big discrepancy in market capitalization between the two firms” in a research note, but said that “a deal is still realistic possibility.” The analyst firm noted that Xerox is slated to receive $2.3 billion as part of a recent deal in which it would sell a 25% stake in its joint venture Fuji Xerox to Fujifilm, and that HP “has nearly $5B in cash on hand, which provides some financial support to the deal.”

“We also believe that a potential combination could generate well over $5B in annual free cash flow, with upside should significant cost synergies be realized,” the analysts wrote.

The Wall Street Journal noted that if Xerox does end up buying HP, it would be an example of investor Carl Ichahn “orchestrating a deal in which the buyer is smaller than the seller.”

Icahn owns a 10.6% stake in Xerox and has been pushing for the company to make major changes or it “will go the way of Kodak.”

In 2018, Fortune reported on Ichan’s role in overhauling Xerox and blocking the company’s “planned $6.1 billion acquisition of Xerox by Japan’s Fujifilm.”

“Xerox was one of the worst-run companies I ever saw,” Icahn told Fortune. “Both sides of the business were being mismanaged. It was a no-brainer to split it up and bring in new management. Xerox was doing nothing with a great brand—how many companies have a name that doubles as a famous verb?”

HP shares were up 2.3% to $20.01 in mid-day trading on Thursday while Xerox shares were flat at $37.65.

Fortune contacted Xerox for comment and will update this story if it responds.