Xerox Corp. has announced that Japan’s Fujifilm Holdings Corp. is combining the Norwalk-headquartered company into the Fuji Xerox joint venture. Fujifilm will own 50.1 percent of the combined company while Xerox shareholders will receive a $2.5 billion special cash dividend as part of this transaction and retain 49.9 percent ownership.
The new entity will be named Fuji Xerox and trade on the NYSE under the XRX ticker. Dual headquarters will be maintained in Norwalk and Tokyo.
Jeff Jacobson will serve as CEO of Fuji Xerox and the 12-member board of directors will have seven individuals from the Fujifilm board and five from the Xerox board, with Fujifilm Chairman and CEO Shigetaka Komori serving as chairman of the board. Xerox said in a statement that the new Fuji Xerox “is expected to deliver at least $1.7 billion in total annual cost savings by 2022.”
In a Tokyo news conference to announce this venture, Fujifilm announced that it would cut 10,000 Fujifilm Xerox jobs, or roughly one-fifth of the workforce, in the Asia-Pacific region. Reuters reported that Fujifilm experienced a 29.4 percent drop in operating profit at its document solutions operations, which includes Fuji Xerox, for the third quarter of 2017, Overall, the company saw a 3.4 percent increase in its operating profit for the quarter.
The companies have worked together since the creation of the Fuji Xerox joint venture 55 years ago, which sells copiers and printers in the Asia-Pacific market and generates about $10 billion in annual sales. Fujifilm owns 75 percent of the Fujifilm Xerox joint venture.
The newly combined Fuji Xerox is the result of a series of secretive talks that were first disclosed by the Wall Street Journal two weeks ago. News of these talks sparked public criticism from two major Xerox shareholders, billionaire investor Carl Icahn and Dallas business executive Darwin Deason, who decried a lack of transparency by Xerox; Icahn went so far as to demand Jacobson’s termination as CEO. Neither Icahn nor Deason issued public statements on the Fuji Xerox announcement.
The Fujifilm Xerox announcement came as Xerox reported a net loss from continuing operations of $196 million, or 78 cents per share, in the fourth quarter of 2017. Xerox employs about 36,000 globally, and there was no announcement on whether its workforce would be trimmed following the creation of Fujifilm Xerox.