Xerox Corp. said late today it has decided to give up its pursuit of printing business rival HP Inc. because of the ongoing economic turmoil caused by the coronavirus pandemic.

The company said it will formally withdraw its tender offer to acquire HP, as well as its proposal to replace HP’s board of directors with nominees of its own.

Xerox’s decision comes after it said earlier this month it was postponing a planned meeting with HP shareholders to focus on dealing with its own coronavirus-related problems. It’s a big setback for the billionaire activist investor Carl Icahn, who many believe was the main driving force behind Xerox’s bid, after taking big stakes in both firms.

According to a statement by Xerox’s board of directors, it’s too risky to continue pursuing HP without access to its books. It means there’s no way for Xerox to assess the impact of the coronavirus on HP’s business, it said.

Xerox was preparing to challenge HP’s board at the company’s annual shareholder meeting, but will now abandon that effort, Reuters reported.

“While it is disappointing to take this step, we are prioritizing the health, safety and well-being of our employees, customers, partners and other stakeholders, and our broader response to the pandemic, over and above all other considerations,” Xerox said in a statement Tuesday. “There remain compelling long-term financial and strategic benefits from combining Xerox and HP. The refusal of HP’s Board to meaningfully engage over many months and its continued delay tactics have proven to be a great disservice to HP stockholders, who have shown tremendous support for the transaction.”

Pund-IT Inc. analyst Charles King told SiliconANGLE that Xerox’s decision to abandon the takeover attempt is a lucky break for both sides. For HP, it means it will now be able to focus on surviving and thriving in a world teetering on the edge of medical disaster and financial chaos, without wasting resources on fending off the unwanted attention of Xerox, he said.

“The pandemic also offers cover to Xerox, allowing the company to gracefully withdraw from one of the most ill-advised takeover attempts in recent memory,” King said. “Absent COVID-19, Xerox would likely have been deservedly ridiculed and kicked to the curb by sensible HP shareholders. Let’s call it a no harm/no foul, win/win for both companies.”

HP’s board had consistently rejected Xerox’s efforts to force a merger and had launched a series of measures aimed at thwarting the deal.

Photo: Xerox