Xerox Corp. shareholder Darwin Deason has filed a lawsuit to block the Norwalk company’s split into two entities – Xerox and business processing outsourcing unit Conduent – expected to take place at the end of the year.
In the suit, filed in the U.S. District Court in Dallas, Deason argues that the split would leave him invested in an “unattractive, low-growth” document technology business. He maintains that the split would reverse Xerox’s $6.2 billion purchase in 2010 of the company he founded, Affiliated Computer Services Inc. (ACS).
As part of that acquisition, Deason negotiated for preferred shares in Xerox that were specifically designed to compensate for his controlling stake in ACS and to “guarantee his continued investment in the combined investment-grade business of the company,” according to the suit. Deason owns about 6 percent of Xerox shares.
Xerox said that it intends to seek the suit’s dismissal, and that it expects its separation to be completed on schedule.