decor decor
"I feel that luck is preparation meeting opportunity."

-Oprah Winfrey

HP Agrees to Acquire Samsung’s Printer Business

Financial Information
  • Enterprise Value                                    $1.05 Billion
  • EV/LTM Revenue                                  0.6x
Transaction Facts
  • HP, Inc. (NYSE: HPQ) announced today that it agreed to buy the printer business of Samsung Electronics (KRX: 005930) for $1.05 billion.
  • Following the completion of the sale, which is expected to close within one year and subject to regulatory approval, Samsung will purchase between $100 and $300 million in HP shares in open market transactions.
  • The transaction is the largest ever print acquisition for HP, and provides the company the technology to make its first serious steps into the $55 billion dedicated copier market. Following the transaction announcement, HP announce the release of 16 new printers intended to compete directly with large corporate multifunction printers (or A3 printers).
Like HPE, Focusing On What Drives Value
  • Watching the Ink Dry: HP receives most of its profit from the sale of ink and toner for its printers, but as the consumer market continues to shift away from printing it is seeing that revenue stream begin to dry up. The company saw revenue decrease 20 percent year-over-year in the third fiscal quarter.
  • Looking Inside the Box: Though HP is the market leader for desktop-class printers, the company does not manufacture the printing engines that power laser printers and instead relies on Canon to supply it. With this deal, the company gains Samsung’s printing engine manufacturing capability, which it will use in its upcoming line of A3 printers.
  • A $55 Billion Opportunity: HP has not been a meaningful presence in the A3 printer market despite prior attempts, but with demand for its traditional business slowing the company has decided it can no longer avoid what it estimates to be a $55 billion market. Going forward it can expect stiff competition from major competitors such as Xerox, Canon, Toshiba and Konica Minolta.
  • Win-Win: This deal promises upside potential in multiple ways. HP is successfully removing a competitor while expanding its geographical presence, relieving pressure on selling price and increasing margin through meaningful cost takeout.
For more information about this transaction, click here to read the press release.
martinwolf was not the advisor in this transaction.
previous post Back to Articles next post

15 Apr 2021

KKR to Acquire Ensono in $1.7 Billion Deal

Financial Information ($USD) Enterprise Value:    $1.7 Billion Transaction Details Global investment firm KKR & Co, Inc. (NYSE: KKR) is acquiring leading hybrid IT services provider Ensono from private equity firms Charlesbank Capital Partners and M/C Partners. While financials have not been disclosed, the transaction is valued at $1.7 billion inclusive of debt, according to Reuters....

12 Apr 2021

Microsoft Acquires Nuance in $19.7 Billion Deal

Financial Information ($USD) Enterprise Value: $19.7 Billion EV/LTM Revenue: 13.97x EV/LTM EBITDA: 89.55x   Transaction Details Microsoft (Nasdaq: MSFT) today announced that it will acquire Nuance Communications, Inc. (Nasdaq: NUAN) in an all-cash transaction valued at $19.7 billion. Nuance, a speech recognition and artificial intelligence company, will be acquired for $56.00 per share, approximately 23%...

22 Mar 2021

SYNNEX Announces Merger with Tech Data

SYNNEX Announces Merger with Tech Data   Financial Information ($USD) Enterprise Value: $7.2 Billion EV/LTM Revenue:  0.20x EV/LTM EBITDA: 9.50x   Transaction Details Leading distributor SYNNEX Corporation (NYSE: SNX) today announced that it will merge with fellow distributor, Tech Data, in a deal worth approximately $7.2 billion, including net debt. The deal creates a distribution...