Fujifilm Announced to Merge Xerox and Fuji Xerox and Acquire Control of Xerox

Sourced from Keypoint Intelligence

After weeks of speculation, Fujifilm Holdings and Xerox has recently announced an agreement that they will merge Xerox with Fuji Xerox – the joint partnership between Xerox and Fujifilm – with Fujifilm taking over the new company with 50.1 percent ownership.

The move comes after demands by two Xerox majority investors, billionaire activist investor, Carl Icahn and Darwin Deason, for Xerox to disclose the nature o  f its talks with Fujifilm of Tokyo, Japan, and for removal of Xerox leadership.

The transaction is expected to close around July-August this year.

The new entity, to be called as Fuji Xerox, will become a subsidiary of Fujifilm, with dual headquarters in the United States and Japan. It will keep Xerox’s listing on the New York Stock Exchange and will be led by Xerox CEO Jeff Jacobson and Fujifilm Chairman Shigetaka Komori.

Under the agreement, the new combined company is expected to have annual revenues of $18 billion and leadership positions in key geographic regions. As part of its own restructuring, Fujifilm said it was cutting 10,000 jobs at Fuji Xerox, more than a fifth of its workforce at the joint venture, in the Asia Pacific region.

In addition, the new combined company will have “enhanced financial flexibility for future growth investments and capital returns”.

According to Xerox, “the new Fuji Xerox will be well-positioned to lead in growing areas such as high-speed inkjet, packaging, industrial print and workplace automation, as well as future development opportunities in artificial intelligence, machine learning, internet of things and augmented reality.”

There new restructuring is also believed to provide significant opportunities for cost savings and leveraging of core technology and go-to-market assets.

Fujifilm CEO Komori, commented at a briefing: “This has been a speedy decision, but I believe it’s a creative one. The new structure will leverage the strengths of our three companies.”

InfoTrends also shares the same opinion, believing that Xerox is making a smart move to combine assets with long-time partner Fuji Xerox, under a strong parent company with deep financial and technology resources.