Fujifilm has purchased a majority stake in Xerox for US$6.1bn to create an US$18bn mega business, with New Fuji Xerox as it will be called now 50.1 per cent owned by Fujifilm.
The company says it is chasing a potential addressable market approaching US$120bn. They say New Fuji Xerox will jump ahead of Canon and Ricoh in printing revenues, and will be close to HP in terms of scale.
“This has been a speedy decision, but I believe it’s a creative one,” Fujifilm CEO Komori told reporters at a briefing. “The new structure will leverage the strengths of our three companies.”
As part of its own restructuring, Fujifilm said it was cutting 10,000 jobs at Fuji Xerox, more than a fifth of its workforce at the joint venture, in the Asia Pacific region.
Xerox’s CEO said the combined company would gain an increased edge in new technologies, along with higher revenues and cost synergies, while Xerox shareholders would also benefit from a $2.5 billion special cash dividend resulting from the deal.
“This transaction...offers substantial upside for shareholders of the combined companies, including current shareholders of Xerox and Fujifilm Holdings, who will own shares in a more competitive company that has enhanced opportunities for long-term growth and margin expansion,” Jacobson said in a pre-recorded video message.
The combined company will be considered a subsidiary of Fujifilm, with dual headquarters in the United States and Japan, and listed in New York. It will be led by current Xerox CEO Jeff Jacobson, with Fujifilm CEO Shigetaka Komori serving as chairman.
Shigetaka Komori, chairman, Fuji Xerox says, “The merger will enable Fujifilm to formulate a consistent global and management strategy. Fujifilm and Xerox have fostered an exceptional partnership through our existing Fuji Xerox joint venture, and this transaction is a strategic evolution of our alliance.
For printers purchasing hardware, the branding will not change, with the Fuji Xerox name to be maintained in the Asia Pacific, and Xerox in the US.