Xerox aborts transaction with Fujifilm, instead agreeing a deal closer to home.
Xerox has axed its plans to carry out a $6.1billion deal with Fujifilm; instead, entering into a new agreement with activist investors Carl Icahn and Darwin Deason the company said on Sunday.
“We are extremely pleased that Xerox finally terminated the ill-advised scheme to cede control of the company to Fujifilm,” Mr Icahn said. “With that behind us and new shareholder-focused leadership in place, today marks a new beginning for Xerox.”
The transaction was terminated due to the failure of Japanese company Fujifilm to deliver adequate financials of Fuji Xerox by April 15th; in addition to the two investors, who jointly own 15 percent of the company, stating the deal undervalued the company.
Xerox’s original transaction expected to see the photocopying company merge its business with a joint venture it operates with Fuji in Asia; with investors to receive a $2.5billion cash dividend as part of the deal. However, calling off the controversial sale means Xerox will now hand over control of the company to shareholders.
“The Board has repeatedly requested that Fujifilm immediately enter into negotiations on improved terms for a proposed transaction,” The former Board of Directors at Xerox said in a statement. “Despite our insistence, Fujifilm provided no assurance that it will do so within an acceptable timeframe. The Board believes that the transaction cannot reasonably be expected to be completed under these circumstances, particularly given the court’s injunction of the transaction and the lack of shareholder support for the transaction on current terms.”
Terminating the transaction also ends months of infighting from the company, which saw Xerox have a major boardroom shift; seeing six board members step down.
Amid the new transaction, five new board members have been appointed at Xerox; including a newly named Vice Chairmen and CEO, John Visentin. Other successors to roles of the company include Jonathan Christodoro, Keith Cozza, Nicholas Graziano and Scott Letier.
The new Board of Directors plan to meet imminently; beginning a process of planning and Xerox’s strategy and maximise shareholder value.