Lexmark to Break Up?

Following its strategic alternatives exploration, Lexmark is said to consider the possibility of divesting its hardware and software assets separately to revive interest in its sales process.

According to people familiar with the matter, several potential buyers are now having conversations with Lexmark about acquiring either its hardware or software assets. The company has yet to make any decision on a way forward.

“Lexmark does not intend to comment on the exploration process or disclose further developments until the board approves a specific transaction or otherwise concludes the exploration of strategic alternatives,” the company said in a statement.

In October, 2015, Lexmark announced its strategic alternatives plan, including a sale, and had hired Goldman Sachs Group Inc (GS.N) as an adviser. Over the past few years, Lexmark has been making endeavors to diversify and cultivate software assets to bulk up its services catering to business customers.

Despite enjoying a higher growth rate, Lexmark’s software still amounts to a small portion of revenue, compared to the hardware business. Lexmark expected that the deal would double the size of its enterprise software unit to a $700 million business.

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