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Xerox to buy Global Imaging Systems

Xerox to buy Global Imaging Systems
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First Published: Mon, Apr 02 2007. 06 06 PM IST
Updated: Mon, Apr 02 2007. 06 06 PM IST
New York: Xerox Corp., the world’s largest maker of high-speed color printers, agreed to buy Global Imaging Systems Inc. for about $1.5 billion (Rs6,522 crore) to gain more small companies as customers in the US.
Global Imaging investors will get $29 a share in cash, Stamford, Connecticut-based Xerox said on 2 April in a statement. The price is 49% more than the $19.50 close on 30 March. The purchase will add to 2007 earnings, Xerox said.
The deal would help Xerox add almost 200,000 customers in the US, who generated $1.03 billion in sales last year. The move also may allow Xerox Chief Executive Officer Anne Mulcahy to revive growth in equipment sales, which dropped 1% in the latest quarter.
“Through the acquisition, Xerox will benefit not only from increased equipment sales but also from the strong annuity stream that comes from the service and supplies to support these products,” the company said.
Global Imaging will start selling Xerox items through 21 regional companies, Xerox said. Doing so will boost Xerox’s distribution to small and mid-sized companies by more than 50%, Mulcahy said in the statement.
Xerox shares fell 11 cents to $16.89 on 30 March in New York Stock Exchange composite trading. They had gained 12% in the past year before today. Global Imaging dropped 7 cents to $19.50.
Global Imaging Chairman and Chief Executive Officer Tom Johnson and President Michael Shea will stay on, reporting to Jim Firestone, Xerox president for North America. Global Imaging, with 4,500 employees, will keep its headquarters in Tampa, Florida.
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First Published: Mon, Apr 02 2007. 06 06 PM IST