After years of boardroom bickering and months of public pissing-and-moaning, Xerox ‘activist’ investors toppled the $6.1B merger that Xerox inked with Fujifilm last January.
Masterminded by merger manipulators Carl Icahn and Darwin Deason (who together own 15.2% of the document diva), the cold feet came about due to Fuji-failure to fulfill demands for a higher stock price.
Well-known activist investor (aka shareholder who leverages equity to change corporate management) Carl Icahn bought 7% stake in Xerox in 2015 — and challenged Xerox’s direction from the start.
With fellow merger mischief-maker Demon Deason, Icahn demanded old-guard board members step down, and insisted that Fujifilm merger terms (at $28 vs. Icahn’s desired $40) grossly undervalued the company.
In a confusing move last month, Icahn and Deason won a settlement to boot the Xerox CEO and swap out its board, but then decided against it 2 days later.
As it turns out, they were holding out for a bigger win — one where they tossed the board overboard and axed the Fuji agreement.
The Japanese photo giant immediately threatened legal action against Xerox, claiming they didn’t have the right to terminate the finalized deal.
But under the terms of Icahn’s settlement, 5 Fuji-friendly board members at Xerox — including CEO Jeff Jacobsen — packed up their desks, leaving Fuji with little sway over a board of Icahn-spirators.
Fujifilm and Xerox’s 6 decade-old joint venture — Fuji Xerox — would have combined with the normal Xerox under Fujifilm controlling ownership.
But now that the deal is off, the Icahn and Deason-directed company — whose shares fell as much as 10% following the announcement — is looking for new buyers.
Since there are few photocopy-fanatics out there likely to shell out for Icahn’s ambitious $40 stock price, the company may end up going back to Fujifilm after all — under “superior terms,” of course.