Daily Management Review

Head of Xerox suspected of a conflict of interest in Fuji's takeover


04/16/2018


Billionaire Darwin Deason accused Jeff Jacobson, CEO of Xerox, that he actively negotiated a deal with Fujifilm, despite a ban on the part of the company's board of directors.



Ra Boe
Ra Boe
According to the billionaire, the general director of Xerox sought to obtain guarantees from the representatives of Fuji that he would continue to head the company after the takeover. Thus, he defended his own interests, and not the interests of shareholders, the suit said.

As follows from correspondence attached to the case, Jacobson and the representatives of Fuji agreed to "fight as one team against a common enemy", that is, against another well-known investor Carl Celian Icahn (he and Deason own about 16% of the company's shares, and they jointly opposed transactions and publicly called to replace the company's CEO).

At the same time, Jacobson urged the Fuji management to make clear to the board of directors of Xerox that they are ready to merge only if he remains at the head of the company, writes The Wall Street Journal.

Meanwhile, in November last year, Xerox Chairman of the Board Robert Keegan told Jacobson that he could be dismissed because of weak financial performance. In addition, Keegan supposedly forbade the general director to conduct further negotiations with Fuji. The company began looking for a new CEO, but stopped after an official offer from Fuji, made in late November. A few days later, the board of directors decided to retain the post of CEO for Jacobson. 

Keegan said on Sunday that Jacobson had "all the powers to negotiate with Fujifilm." According to him, Deason distorts the facts in his suit.

Xerox and Fuji made a deal in late January. Under its terms, Xerox will join the joint venture of the two companies Fuji Xerox, created more than half a century ago. Xerox shareholders will receive a total of $ 2.5 billion in special dividends and will remain owners of 49.9% of the joint venture. Jacobson will become the head of Fuji Xerox.

Now Icahn and Deason are seeking the resignation of the board of directors, writes WSJ. If they manage to do this, they can appoint representatives to the council who can vote for tcancellation of the transaction or the revision of its terms. 

Xerox shares are getting cheaper by 0.6% during the preliminary bidding on Monday. Over the past three months, the company's capitalization has fallen by 14%, to $ 7.17 billion.

source: cnbc.com






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