Xerox Pops As Icahn And Deason Wage War, Demand Management Change, Strategic Alternatives

Xerox Corp XRX opened up 4 percent Monday after activist investors Carl Icahn and Darwin Deason announced their collaborative proxy battle with Xerox management.

“CEO Jeff Jacobson, a member of the Xerox ‘old guard,’ is incapable of creating long-term value for Xerox shareholders and should be replaced immediately,” they co-wrote in a statement. “If the ‘old guard’ directors are unwilling to make the tough decisions necessary to prevent the Xerox ship from sinking, then they must be replaced as well.”

Xerox's first and third largest shareholders, together boasting more than 15 percent of outstanding shares, affirmed their joint call for the election of four new directors and outlined additional demands, including:

• The termination or renegotiation of the firm’s joint venture with Fuji Xerox and the disclosure of extant agreements;
• The exploration of strategic alternatives; and
• Management replacement.

Icahn and Deason expressed doubt that the directors will respond to demands and assured fellow shareholders that Monday’s letter “is just the beginning” of their campaign.

“Every day that the ‘old guard’ remains in power – feebly overseeing the company’s steady decline – is a waste of time that could inevitably erode the value of our investment down to nothing,” they wrote. “We simply cannot wait any longer for things to change.”

In a statement to Benzinga, a Xerox spokesperson said, "The Xerox Board of Directors and management are confident with the strategic direction in which the Company is heading and we will continue to take action to achieve our common goal of creating value for all Xerox shareholders.”

At time of publication, shares were trading around $32.10, up just 0.9 percent off the open.

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