Xerox ending Fujifilm deal, settles with Icahn, Deason

Xerox ending Fujifilm deal, settles with Icahn, Deason

Xerox ending Fujifilm deal, settles with Icahn, Deason

Xerox said on Sunday that it was calling off its merger deal with Fujifilm of Japan, after reaching a settlement with the shareholder activist Carl Icahn and another major investor who sharply opposed the deal.

Together, Icahn and Deason reportedly own over a tenth of the ~US$8 billion company.

Under the new agreement with Icahn and Deason, Xerox will replace five board members.

Subsequent to joining the Xerox Board of Directors, Keith Cozza, the Chief Executive Officer of Icahn Enterprises L.P., is expected to be appointed as the new Chairman of the Board of Directors of Xerox, and John Visentin is expected to be appointed as the Vice Chairman and new Chief Executive Officer of Xerox. "Despite our insistence, Fujifilm provided no assurance that it will do so within an acceptable timeframe", Xerox's former board said in a statement.

The Xerox Board believes that the transaction can not reasonably be expected to be completed under these circumstances, particularly given the court's injunction of the transaction and the lack of shareholder support for the transaction on current terms, as well as the unresolved accounting issues at Fuji Xerox.

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The Japanese company said it disputes Xerox's "unilateral decision" and doesn't think the U.S. company has the legal right to ax the deal.

Fujifilm (fujiy) on Monday said it "disputes Xerox's unilateral decision" and is "reviewing all of our available options, including bringing a legal action seeking damages".

The company also said in a statement on Sunday that CEO Jeff Jacobson has resigned and that John Visentin is expected to take over as the new boss, Reuters reports.

Icahn and Deason have said they would consider an all-cash bid of at least $40 per share.

Xerox said its new board would meet immediately and "begin a process to evaluate all strategic alternatives to maximize shareholder value".

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Fuji Xerox, 75 percent owned by Fujifilm, handles contracts that supply global clients with Xerox services in the United States and Europe, and Fuji Xerox services in Asia.

It is Xerox's second settlement with the activist investors in just two weeks.

"The board also considered the potential instability and business disruption during a proxy contest".

The settlement marks the end of a tumultuous fight between Xerox and Icahn, its largest shareholder, over a proposed $6.1 billion deal that would hand control of the former U.S. office giant to Fujifilm Holdings Corp. When the statements were delivered, it said, the audited financials had "material deviations" from the unaudited statements given to Xerox earlier.

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