Xerox scraps planned $6.1 billion deal with Fujifilm

Xerox said its new board would meet immediately and “begin a process to evaluate all strategic alternatives to maximize shareholder value.” (Courtesy Xerox)
Updated 14 May 2018
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Xerox scraps planned $6.1 billion deal with Fujifilm

NEW YORK/TOKYO: Xerox has scrapped a planned $6.1 billion deal with Fujifilm Holdings Corp. in a settlement with activist investors Carl Icahn and Darwin Deason that also hands control of the US photocopier giant to new management.
The victory for the billionaire investors puts the Japanese company further on the backfoot in any new negotiations with Xerox, although it is by no means out of contention as Xerox is now expected to go up for sale in an auction at a higher price.
Fujifilm was quick to take a combative stance, saying in a statement it disputes Xerox’s unilateral decision to terminate the transaction and would look at all options including legal action seeking damages.
The two companies agreed in January to a complex deal that would merge Xerox into their Asia joint venture Fuji Xerox. The deal prompted Icahn and Deason, who own 15 percent of Xerox, to launch a proxy fight.
The activist investors have also said they are unhappy with the current structure of the joint venture, and settlement creates uncertainty concerning potential changes to a business that accounts for nearly half of Fujifilm’s revenue.
The settlement will see Chief Executive Officer Jeff Jacobson — the main architect of the deal with Fujifilm — as well as five other directors step down. John Visentin is expected to take the helm.
It is Xerox’s second settlement with the activist investors in just two weeks. The first settlement agreement was allowed to expire as Xerox came to believe it had flexibility to renegotiate a deal with Fujifilm and also took into account a stock dive that followed the agreement.
“We are extremely pleased that Xerox finally terminated the ill-advised scheme to cede control of the company to Fujifilm,” Icahn said in a statement.
Xerox said its new board would meet immediately and “begin a process to evaluate all strategic alternatives to maximize shareholder value.”
Buyout firm Apollo Global Management have considered a bid for Xerox, sources have said.
Visentin had previously been hired by Icahn to assist in fighting Xerox. He had also been a candidate under consideration by the old board to replace Jacobson as recently as last year, according to court documents.
Xerox, which earlier sought better terms from Fujifilm, said it was ending the deal with the Japanese company partly because Fujifilm had failed to provide audited financial information for Fuji Xerox by an April 15 deadline.
Xerox also said there were “material deviations” between audited Fuji Xerox financial statements and unaudited statements provided previously.
As part of the settlement, Xerox and Icahn agreed to withdraw their board candidates from an upcoming shareholder meeting, and said the meeting would be postponed.


First IT-related company starts trading in Saudi bourse

Updated 57 min 22 sec ago
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First IT-related company starts trading in Saudi bourse

DUBAI: Shares of Al-Moammar Information Systems Company started trading at the Saudi Stock Exchange (Tadawul) on Wednesday, the first IT-related entity in the bourse’s roster of 201 listed companies.

Al-Moammar Information Systems Company has been assigned a trading symbol of 7200. The trading symbol is used by investors and traders to transact orders.

Shares were up 3.2 percent to 48.2 riyals in late trade, with 1,038,877 counters changing hands.

The company held a five-day public offering last March and opened for subscription 4.8 million ordinary shares, at an offer price of 45 Saudi riyals per share, representing 30 percent of its paid-up capital.

Saudi Fransi Capital was assigned as financial advisor, lead manager, bookrunner and underwriter of the offering, while Riyad Bank, Saudi British Bank and Banque Saudi Fransi were tasked as receiving agents.