Fujifilm wins appeal in battle with Xerox over scrapped merger

The two companies agreed in January to a complex deal that would have merged Xerox into their Asia joint venture Fuji Xerox and given Fujifilm control. (Reuters)
Updated 17 October 2018
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Fujifilm wins appeal in battle with Xerox over scrapped merger

  • Xerox in May scrapped a $6.1 billion merger deal with Fujifilm
  • A US court overturned preliminary injunctions requested by activist investors that had blocked a planner merger

TOKYO: Fujifilm Holdings Corp. has won an appeal in its legal battle with Xerox Corp, with a US court overturning preliminary injunctions requested by activist investors that had blocked a planner merger.
Xerox in May scrapped a $6.1 billion deal with Fujifilm in a settlement with investors Carl Icahn and Darwin Deason that also handed control of the US photocopier giant to new management.
The ruling by the New York State Appellate Court could give Fujifilm leverage to bring Xerox management back to the negotiating table.
The court found in its ruling that Xerox’s former CEO Jeff Jacobson had neither misled or misinformed the board.
“The board, which engaged outside advisers and discussed the proposed transaction on numerous occasions prior to voting on agreeing to present it to the shareholders, did not engage in a mere post hoc review, nor was the transaction unreasonable on its face,” the ruling also said.
Fujifilm said in a statement that it stands by its view that the original planned merger remains the best option for the shareholders of both companies.
“(The) Court’s decision will allow us to discuss with Xerox the fulfillment of the original agreement. All Xerox shareholders ought to be able to decide for themselves the operational, financial, and strategic merits of the transaction to combine Fuji Xerox and Xerox,” it said.
The two companies agreed in January to a complex deal that would have merged Xerox into their Asia joint venture Fuji Xerox and given Fujifilm control. That prompted Icahn and Deason, who own 15 percent of Xerox and argued the US firm was being undervalued, to launch a proxy fight.
Representatives for Xerox and Deason were not immediately available for comment.


Oman regulator suspends KPMG from new auditing work over ‘irregularities’

Updated 14 November 2018
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Oman regulator suspends KPMG from new auditing work over ‘irregularities’

  • In Oman, KPMG is banned for one year from doing new auditing work for companies regulated by the CMA
  • It is another setback for KPMG, which is under scrutiny after losing clients in South Africa following its role in a high-profile corruption scandal there

DUBAI: Oman’s securities regulator said on Wednesday it has suspended audit firm KPMG from doing new work for a year after finding major financial and accounting irregularities at some listed companies.
The Capital Market Authority (CMA) took corrective steps at those companies to protect investors, it said in a statement without naming the firms or giving other details.
A review by the CMA “established professional negligence on the part of some audit firms that warranted disciplinary measures against them in the interests of the investors and other stakeholders,” the CMA said.
It is another setback for KPMG, which is under scrutiny after losing clients in South Africa following its role in a high-profile corruption scandal there and has faced investigations in Britain over its auditing of some clients.
In Oman, KPMG is banned for one year from doing new auditing work for companies regulated by the CMA, including listed companies, securities firms and insurers.
The penalty does not affect projects where KPMG has already been appointed, and KPMG has a right to appeal against the penalty before an independent authority, the CMA said.
KPMG said it could not immediately comment on the CMA’s statement.