Las Vegas, NV—The president of Fujifilm Holdings Corporation, Kenji Sukeno, announced that Fujifilm and Xerox Corporation entered into a definitive agreement to combine Xerox and the companies’ longstanding Fuji Xerox joint venture.
Furthermore, Fujifilm will own 50.1% of the combined company. The transaction was unanimously approved by the board of directors of both Fujifilm and Xerox.
The two companies have fostered a partnership through the existing Fuji Xerox joint venture for the past 56 years and have deepened their mutual cooperation in technology and other areas. Founded in 1962, it is a document solution company that is currently a 75–25 joint venture between Fujifilm and Xerox.
The new agreement will see Xerox Corp. combine with the Fuji Xerox joint venture. Moreover, Xerox will change its name to “Fuji Xerox” (hereinafter “New Fuji Xerox”).
Fujifilm will acquire 50.1% of the new company. In addition, 49.9% will be publicly traded, as the new Fuji Xerox will be listed on the NYSE. Moreover, the combined company will maintain the Fuji Xerox and Xerox brands within its respective operating regions. Fuji Xerox operates mainly in Japan and the Asia Pacific, while Xerox focuses on the U.S. and European markets.
The two companies view this transaction as the optimal conclusion for both Fujifilm and Xerox. Moreover, it was reached after evaluating various options to enhance the corporate value and is expected to deliver significant synergies.
“New Fuji Xerox will become a world-leading document solution company by revenue. Under a globally unified management strategy, the combined company will further accelerate its business growth and offer new value to customers,” the companies announced in a joint statement.
“New Fuji Xerox will benefit not only from its size but also from its solid management resources, including strong brands, state-of-the-art technologies and excellent human resources that support these brands, global marketing capabilities and excellent client base.”
The combined company is expected to deliver $1.7 billion in total annual cost savings by 2022. In addition, approximately $1.2 billion of the savings is expected by 2020. As part of the cost improvement initiatives, the existing Fuji Xerox will implement a fundamental structural reform.
Governance of New Fuji Xerox
The new company’s board of directors will include twelve members, seven of whom will be appointed by the Fujifilm board. Five independent directors will be appointed from the Xerox board. Moreover, Shigetaka Komori, chairman and chief operating officer of Fujifilm and chairman of the existing Fuji Xerox, will serve as chairman of the board.
Overview of the Transaction
Fuji Xerox will buy back the 75% stake in Fuji Xerox from Fujifilm. Fujifilm will use the proceeds from selling the 75% stake to acquire 50.1% of the new shares of Xerox. There will be no cash outflow from Fujifilm. The new Fuji Xerox will become a consolidated subsidiary of Fujifilm. Both the headquarters of the current Xerox (Norwalk, Connecticut) and the headquarters of the current Fuji Xerox (Minato, Tokyo, Japan) are to be used as headquarters of the new Fuji Xerox. fujifilmusa.com
