Xerox 'sets record straight' over Icahn comments

By Jo Francis, Thursday 10 May 2018

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Xerox’s board has released an open letter to shareholders in response to what it described as “false and highly irresponsible fearmongering” by Carl Icahn.

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Inflammatory comments about Fuji Xerox prompted Xerox letter to shareholders

The manufacturer said it wanted to set the record straight, and counter misinformation and uncertainty in the marketplace caused by the ongoing war of words with its two largest investors – Icahn and fellow billionaire Darwin Deason.

In a 1,500-word missive, Xerox’s board members said they were compelled to respond after Icahn made controversial comments to Japanese business publication the Nikkei Asian Review, stating that he believed there was a risk of bankruptcy in combining Xerox with Fuji Xerox.  

Xerox’s letter said: “We have refrained from engaging in a back and forth with Mr Icahn and Mr Deason in their campaign against the company, even as they targeted management and the board with personal, unsubstantiated attacks that we believe have been damaging to Xerox.

“However… we felt compelled to respond and to point out that Mr Icahn’s fearmongering was false and highly irresponsible.”

It stated that other investors in Xerox are in agreement with the board that there is a compelling strategic rationale for combining Xerox with Fuji Xerox, but also acknowledged the board would need to secure an improved deal in order to gain shareholder support.

Xerox approached Fujifilm about renegotiating the $6.1bn (£4.5bn) takeover deal currently on the table last month.   

The letter also outlines the extraordinary events that saw seven Xerox board members including CEO Jeff Jacobson agree to resign as part of a settlement deal that then expired, leaving the executives in post and prompting Deason and Icahn to state they would “go to war” unless the Fuji Xerox proposal was terminated.

Earlier this week Xerox was unsuccessful in its request for a quick appeal hearing over the court order that put a temporary block on the merger deal. A hearing date has been set for September.

The letter concluded with the Xerox board pledging to remain fully committed to maximising shareholder value – including securing a better deal with Fujifilm – while ensuring all shareholders’ voices were heard.

Xerox’s share price was at $32.29 at the beginning of the month, but has since slipped to $28.38. The 52-week high is $37.42, low: $27.18.

Icahn and Deason had not responded at the time of writing.

Yesterday also marked the global launch for the new Xerox Iridesse digital press, a product of the Fuji Xerox collaboration. Its ability to print CMYK plus silver or gold and a clear dry ink in a single pass was described as "a game changer" by early adopter Instant Print West One in London.   

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