Fujifilm to take over Xerox and cut 10,000 jobs
Fujifilm will fold Xerox into Fuji Xerox, and slash 10,000 jobs in the subsidiary by March, 2020.
The Japanese company says that the takeover of the US technology giant Xerox will create the world’s largest “document solutions company”.
Fuji Xerox presently employs 46,000 people, and mainly conducts business in the Asia-Pacific region. Fujifilm presently owns three-quarters of Fuji Xerox, which was initially founded as a joint venture more than half a century ago.
Fuji Xerox will buy back that stake for US$6.1 billion (S$8 billion); Fujifilm will then use these proceeds to purchase 50.1% of new Xerox shares. Xerox CEO Jeff Jacobson will lead the new, combined Fuji Xerox, under the auspices of Fujifilm. Fujifilm CEO Shigetaka Komori will serve as chairman of the subsidiary.
The deal is expected to be completed by the end of Q4 this year. The combined company will be headquartered in both the US and Japan.
“The new Fuji Xerox will be better positioned to compete in today’s environment with truly global scale, increased presence in fast-growing markets, and innovation capabilities to effectively meet our customers’ rapidly-evolving demands," said Jeff Jacobson, chief executive officer of Xerox.
"In addition, the combined company’s strong financial profile will enable investments that support continued market leadership, while also providing opportunities for increasing capital returns over time," he added.
The massive restructuring arrives at a time when both companies are struggling in an “increasingly severe” market landscape that has seen many organisations go paperless.
Fujifilm has said that the combined company will deliver at least US$1.7 billion (S$2.24 billion) in total cost savings -- of which US$1.2 billion (S$1.58 billion) is expected to be achieved by 2020
The workforce reduction will affect staff both in Japan and elsewhere.