This Week in Imaging: Xerox Shareholders Should Vote on Fujifilm Deal; Industry Financials; More
Amid all the back-and-forth on the proposed Xerox-Fujifilm deal between the Xerox Board of Directors and Carl Icahn and Darwin Deason (Icahn and Deason wrote not one but two public letters to Xerox shareholders this week), the Xerox board’s plea that all Xerox shareholders should vote on the matter – something they were supposed to do this month – seems the most sensible. After all, can Icahn and Deason – who together hold about 15 percent of total Xerox shares – be considered the only Xerox shareholders competent enough to make a decision on the matter? And yet, with Deason’ litigation and subsequent temporary court injunction, the shareholders’ vote has been indefinitely postponed. This makes Icahn and Deason’s opinion on the matter the de facto decision – until and if Xerox obtains a successful appeal on the matter.
On the other hand, looking back, what probably didn’t help matters one bit for Xerox was a boast by Fujifilm CEO Shigetaka Komori’s to the Nikei Asian Review in February, shortly after the proposed deal was announced, that Fujifilm wouldn’t be spending a penny, as the transaction wouldn’t involve any cash payment by Fujifilm. Instead, Fujiflm would instead make the purchase using the unrealized profit on its 75-percent interest in Fuji Xerox, Xerox’s joint venture with Fujifilm – something which seemed to infuriate Icahn. Nor has the accounting scandal at Fuji Xerox New Zealand and Australia helped matters, with, for instance, Xerox forced to take a $28 million for Fuji Xerox New Zealand losses.
The current status appears to be one of limbo, with a New York State judge postponing a hearing on Xerox’s recent appeal that seeks to undo the court’s temporary injunction blocking the Fujifilm deal. During that time, we can probably expect more antics from Icahn and Deason, who have taken to calling Xerox leadership “#lameduckboard,” and more seriously, according to the Nikei Asian Review, Icahn is now warning Xerox shareholders that a proposed takeover by Fujifilm could somehow lead to bankruptcy, stating that the accounting scandal at Fuji Xerox New Zealand and Australia, which resulted in losses of some $450 million, could grow in size.
Meanwhile, this week, the Xerox board explained why they let that settlement expire, and also appeared to state that it was renegotiating the Fujifilm deal. There was lots more, so be sure to check out our stories on this.
Icahn and Deason continue to accuse the Xerox board of “wrongdoing” that’s damaging Xerox, but both Icahn and Deason themselves have done and continue to do considerable harm to Xerox, a fact that competitors are likely more than happy to see.