Fujfilm May Pursue Legal Action Seeking Damages over Terminated Xerox Deal

CRN reports that Fujifilm of Tokyo, Japan, is considering legal action that would force Xerox to pay damages for backing out of acquisition talks. It also said increase its offer for Xerox, which is $6.1 billion, with Xerox shareholders receiving $28 per share. Icahn and Deason have said that the deal under-values Xerox. Xerox is currently trading at about 28 per share; Xerox investors Carl Icahn and Darwin Deason, who together own about 13 to 15 percent of Xerox total shares. have stated that they would be open to all-cash offers of $40 or more per share.

Fujifilm released the following statement: “The proposed transaction, including its economic terms, was negotiated at arm’s length based on fair valuations and we continue to believe it is the best option designed to allow the stockholders of both companies to share the enhanced future value of the combined company with Fujifilm. Fujifilm will urge the Xerox Board of Directors to reconsider their decision.”

On May 13th, Xerox announced it was ending negotiations with Fujfilm. It also announced the resignation of various board members, the resignation of Xerox CEO Jacobson, and the appointment of five new board members loyal to Icahn and Deason, as well as the appointment of Icahn consultant John Visentin as the new Xerox CEO.

The Fujifilm statement also said: “Fujifilm disputes Xerox’s unilateral decision to terminate the transaction. We do not believe that Xerox has a legal right to terminate our agreement and we are reviewing all of our available options, including bringing a legal action seeking damages.

“We also regret to learn that the new Xerox board is attempting to deprive its shareholders of the opportunity to vote on a transaction designed to create substantial value to be gained from a combination of Xerox and Fuji Xerox and decide for themselves the future of their company. We note that this action was taken by a board, the control of which was taken from the rest of its shareholders by a minority holding just 15 percent of outstanding shares pursuant to a settlement agreement that was entered into in violation of our agreement.”

More Resources

%d bloggers like this: