Carl Icahn and Darwin Deason have succeeded in temporarily blocking Fujifilm’s takeover of troubled photocopier company Xerox Corp and in the process ousted Xerox CEO Jeff Jacobson and six more members of the board. Darwin Deason successfully won an NY court injunction blocking Fujifilm from purchasing Xerox last week. Fujifilm issued a statement on Wednesday 2nd May 2018 saying they would appeal against the decision.
The $6.1 Billion proposed takeover was announced in January under the banner “Better Together – The New Fuji Xerox”, but the move was seen as controversial from the start and investors argued it grossly undervalued Xerox that at the time had a market value of $8.2 Billion. The two largest shareholders in Xerox Corp, Carl Icahn and Darwin Deason joined forces to campaign against the takeover.
Xerox Corp once the market leaders in the photocopier industry have struggled to keep pace with changing market conditions, increased competition and digitalisation. On Wednesday they announced 42.5% drop in quarterly profit, blamed in part because of the proposed deal with Fujifilm.
John Visentin is expected to be named the new CEO of Xerox Corp. However, the new CEO will face a challenge turning the struggling photocopier manufacturer around and outlining an alternative path. As the world turns digital and the paperless office becomes a reality manufacturer’s of printers and copiers will need to seek alternative markets. John Visentin comes from a strong IT background with experience within HP and IBM.
Ironically Xerox Corp was once the innovators within the IT industry, providing groundbreaking inventions including the first graphical operating system and the computer mouse at their legendary Xerox PARC facility. Sadly Xerox failed to capitalise on these innovations and instead Apple under Steve Jobs and Microsofts Bill Gates saw the potential and took the graphical operating system to market to stunning effect.
Fujifilm will continue to try to resurrect the Xerox deal but may find the new CEO will look for alternative strategies.