Fuji Xerox now a wholly owned subsidiary of Fujifilm

Fujifilm has bought Xerox’s 25 per cent share in Fuji Xerox for US$2.3b with the company that was established 57 years ago as a joint venture to serve the Asia Pacific markets now wholly in the hands of Fujifilm.

As part of the transaction, Fujifilm has agreed to withdraw litigation it filed against Xerox on June 18th, 2018 related to what it called damages caused by the unilateral cancellation of the definitive agreement between the two companies.

Fuji Xerox has a substantial footprint in the Australia and Asia Pacific markets with a strong government and corporate customer base.

The deal, which means Fujifilm will continue to supply Xerox products, was unanimously approved by the board of directors of both companies earlier this week.

Also included is a commitment by Fujifilm to drop litigation it commenced against Xerox in June 2018 claiming damages by the unilateral cancellation of the definitive agreement between the two companies.

“The transaction is an ideal next step for Fuji Xerox and Fujifilm that we believe serves our stakeholders well and reflects our commitment to create innovative products that contribute to society,” Fujifilm chairman and chief executive officer Shigetaka Komori said in a statement.

“Fuji Xerox has now become a lean and strong company after a series of reforms we started in 2018, and I am confident that with this initiative it will be even stronger.

“Full ownership of Fuji Xerox will facilitate faster decision making in a rapidly changing business environment. At the same time, Fuji Xerox will be able to further strengthen its business by capturing new OEM opportunities in the global market, leveraging our world-leading product development and manufacturing capabilities. We are excited to see a new chapter for Fujifilm and Fuji Xerox.”

Background

Fuji Xerox Co. Ltd was founded in 1962 as a document solutions company. It most recently was made up of a 75 per cent to 25 per cent joint venture between Fujifilm and Xerox. Throughout its 57-year history, it has provided office related products and solutions to increase productivity and has grown into a company with revenues exceeding 1 trillion yen. It is also known as one of the most successful cross-border joint ventures between Japanese and non-Japanese companies.

Fuji Xerox operates in the Asia-Pacific market and has a strong customer base for large corporations and government offices. It has also been able leverage itself in the document industry using its product development capabilities and manufacturing technology.

Fujifilm says that given the uncertainty about the future of the global economy and increased competition in the market, it was decided it would be best to have Fuji Xerox as a wholly owned subsidiary to flexibly implement necessary measures in a timely manner in order to achieve further growth.

Transaction Overview

  • Fujifilm to acquire Xerox’s 25% ownership stake in Fuji Xerox and its 51% ownership in Xerox International Partners, a 51%-49% Joint Venture between Xerox and Fuji Xerox that operates OEM business in the U.S. and Europe
  • Fujifilm to have expanded OEM opportunities in the global market under a new agreement with Xerox
  • Fuji Xerox and Xerox to extend an existing product supply agreement
  • Fujifilm to pay USD $2.3Bn (JPY 253.0Bn (*1)) in aggregate to Xerox

*1 Based on exchange rate of 110JPY = USD

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