Xerox, under pressure from activist investor Carl Icahn, will split into two companies: one devoted to the processing of documents, including its famous copiers, the other dedicated services. The transaction is expected to close by the end of the year.
Announced on the occasion of the publication of the annual results 2015, this development marks a halt to the strategy of diversification into services set up after the arrival of the CEO Ursula Burns of the group in 2009.
“The realities of the market today require agility and greater flexibility, an ability to innovate and adapt technology to constantly changing customer needs and a more precise and efficient approach to operations and capital allocation, “explained the group in a statement.
Savings Plan
The reorientation of Xerox, which began in 2010 with the acquisition of ACS Group, has not had the desired effect and the group, best known for its copiers, printers and scanners, is restructuring after several years.
The company, based in Connecticut on the east coast of the United States, has also announced Friday, January 29 a program to 2.4 billion savings on next three years. He hopes to cut costs by $ 700 million in 2016.
When choosing the option of dismantling, Xerox follows the example of the giant Hewlett Packard computer, which formalized his separation in November Two companies, one dedicated to services and products for businesses, the other keeping the historical activities in printers and computers.
New eBay
After a net loss in Q3, Xerox announced late October a strategic review of all its activities, without detailing what options were on the table.
Carl Icahn had burst into the Xerox capital a few weeks later in November, gradually increasing its stake to become the second largest shareholder with 8.13% of the capital behind the Vanguard fund (8.4%).
Ursula Burns provided on CNBC that the arrival of billionaire bubbling did not influence the strategy of Xerox, saying it had “nothing to do with the initiation, reflection, analysis or discussion of Operation “split.
Nevertheless. Carl Icahn has never hidden want to discuss with the leadership of Xerox ways to improve operational performance and seek other strategic routes.
And it will be offered three seats in the new Board of Directors of the new company dedicated to services.
Worker split the eBay / PayPal
The businessman is deemed to interfere in the management of enterprises in which it invests, with great fanfare of media statements. Among his recent exploits include the split between the online trade group and eBay subsidiary PayPal payments.
He also makes direct reference to this precedent weapon in a tweet , writing: “I applaud and respect Urusula Burns to do what she thinks is the will of the shareholders, as John Donahoe did for eBay and PayPal”
On Wall Street, the title. the group, which was valued 9.71 billion dollars in exchange, took 3.20% to 9.52 dollars.
As for results, Xerox has split its net profit more than doubled on whole year, generating $ 488 million against profits of 1.01 billion in 2014.
Its turnover, down from 8% to 18.05 billion dollars, s’ appears below forecasts. But adjusted per share excluding exceptional items, earnings were 98 cents, slightly above the 95 cents expected by analysts. Its forecast for adjusted earnings per share of between $ 1.10 and $ 1.20 in 2016 also slightly exceeds the forecast.
(with AFP)
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