Fujifilm takes over Xerox, up to 10,000 jobs to be lost as a consequence
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Xerox is one of the very few information technology brands with a history of more than a century, but all empires must fall sooner or later. In this case, it seems that 111 years is more than enough, since Fujifilm and Xerox have just announced that the Japanese company will take over the Connecticut-based Xerox Corp and combine it into the existing Fuji Xerox.
The main reason for this move is to cut costs since the demand for office printing products has been going down lately and there is no hope for recovery in sight. After all, most companies and even many governments are taking full advantage of the digital era's benefits, and printing fewer documents than two decades ago is one of them.
To cut a long story short, Fujifilm Holdings will take over Xerox Corp in a US$6.1 billion deal, but it gets quite complicated along the way. More than 50 years ago, Fuji Xerox was established by Fujifilm and Xerox to sell photocopying services and products in the Asia-Pacific region. Now, Fujifilm owns a stake of 75 percent in it, but Fuji Xerox will buy that stake back for US$6.1 billion using bank debt, and then will buy 50.1 percent of Xerox Corp shares with the proceedings.
The deal is expected to be completed by the end of the summer, and the combined company will use the Fuji Xerox name. The "new" Fuji Xerox will be a Fujifilm subsidiary with dual headquarters in the United States and Japan. Xerox CEO Jeff Jacobson will lead Fuji Xerox, with Fujifilm CEO Shigetaka Komori serving as chairman.
By the end of 2022, the plan is to consolidate various operations, including R&D and procurement, allowing to save up to US$1.7 billion. Unfortunately, this would involve the loss of up to 10,000 jobs.
Looking back at the mistakes Xerox made during its long history, the worst of them all is when the company's board of directors decided to share the key elements of personal computing developed by Xerox engineers with Apple. These elements include the desktop user interface and the computer mouse. Well, it looks like they should have had a bit of trust in the future of personal computing.