Xerox terminates agreement to merge with Fujifilm

Xerox terminates agreement to merge with Fujifilm

Xerox closed 2.9% higher at $30.17 on Friday in the USA for a market capitalization of $7.7 billion.

Jeff Jacobson resigned from his role as CEO and Xerox board member. "Despite our insistence, Fujifilm provided no assurance that it will do so within an acceptable timeframe", the former Xerox board said.

Xerox said it was terminating its agreement to combine with Fuji Xerox after Fujifilm failed to provide audited financials for the joint venture on time, and other issues.

But Icahn and Deason blasted the deal, saying it significantly undervalued the U.S. company and would be its "death knell".

The new board will be chaired by Keith Cozza, who is the current CEO of Icahn Enterprises, while its new CEO is set to be John Visentin.

Xerox called off a $6.1 billion takeover by Fujifilm Holdings and parted ways with its chief executive officer, handing a major victory to activist investors Carl Icahn and Darwin Deason. However, Fujifilm has disputed the decision and is reviewing its legal position. "Fujifilm will urge the Xerox board of directors to reconsider their decision". Bloomberg earlier reported on the cancellation of the transaction.

"Over the past several weeks, the Xerox Board has repeatedly requested that Fujifilm immediately enter into negotiations on improved terms for a proposed transaction", the firm said. Fujifilm has said it's appealing a United States court injunction blocking the takeover.

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Helping Icahn and Deason's case was a court decision in late April that temporarily blocked the planned merger with Fujifilm.

Xerox's former board said it believes the transaction can not be completed under the circumstances, citing a court injunction and "the lack of shareholder support for the transaction on current terms". He also claimed in the lawsuit that the company's board breached its fiduciary duties.

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 almost half of Fujifilm's revenue.

"We are extremely pleased that Xerox finally terminated the ill-advised scheme to cede control of the company to Fujifilm", he said.

Xerox plans to appoint a new leadership and discuss alternative strategies.

The iconic U.S. printer and copier company announced the move in a statement late Sunday, saying it had reached a new agreement with activist investors Carl Icahn and Darwin Deason, who had bitterly opposed the Fujifilm deal.