Xerox terminates $6.1-bn merger with Fujifilm, reaches agreement with Icahn & Deason

US photocopier giant Xerox Corp yesterday said that it is terminating its planned merger with Fujifilm Holdings Corp and instead reached a new agreement with its top shareholders to replace its CEO and board of directors.

The surprise announcement ends a bitter fight between Xerox and two of its largest shareholders — activist investor Carl Icahn and Darwin Deason, the largest and third-largest shareholders respectively, over a proposed deal to sell itself to Fujifilm for $6.1 billion.
Explaining the reasons for the termination of the deal, Xerox said, was “among other things, the failure by Fujifilm to deliver the audited financials of Fuji Xerox by 15 April 2018.”
Under the terms of the new settlement with the top shareholders:
Jeff Jacobson has resigned  as CEO and as a member of the board. Five of the board members have resigned and Xerox has appointed five new members to its board.
Keith Cozza, CEO of Icahn Enterprises, who has been appointed to the board of Xerox, is expected to be appointed as the new chairman of Xerox, and John Visentin is expected to be appointed as the vice chairman and new CEO of Xerox.
Commenting on the new development, Icahn said, “We are extremely pleased that Xerox finally terminated the ill-advised scheme to cede control of the company to Fujifilm ... With that behind us and new shareholder-focused leadership in place, today marks a new beginning for Xerox.”
Both Xerox and Fuji Film had in January agreed to a complex deal that would have merged Xerox into their Asia joint venture Fuji Xerox and given Fujifilm full control of Xerox.
Icahn and Deason, who hold 15 per cent of Xerox, and launched a proxy fight opposing the deal, saying that Xerox was being undervalued.
Icahn and Deason had said that Fujifilm's offer of $28 per share was too low and were seeking an all-cash bid of at least $40 per share.
In February, Deason filed a lawsuit to block the proposal and said Jacobson did not have the authority to strike a deal that preserved his job at shareholders’ expense (See: Icahn, Deason team up to push for Xerox sale, sack CEO Jacobson). 
“With the limiting Fujifilm agreement terminated, Xerox is now positioned to conduct a true, robust strategic alternatives process. John Visentin has spent weeks preparing himself to run the company and speaking to numerous market participants regarding strategic alternatives,” said Darwin Deason in a statement.