Xerox to buy Lexmark in $1.5bn deal

Lexmark is being bought from Ninestar Corporation, PAG Asia Capital, and Shanghai Shouda Investment Centre.

Xeros said the deal will strengthen its core print portfolio and build a broader global print and managed print services "business better suited to meet the evolving needs of clients in the hybrid workplace".

Steve Bandrowczak, chief executive officer at Xerox, said: "Our acquisition of Lexmark will bring together two industry-leading companies with shared values, complementary strengths, and a deep commitment to advancing the print industry to create one stronger organisation.

"By combining our capabilities, we will be better positioned to drive long-term profitable growth and serve our clients, furthering our Reinvention."

Xerox said it expects to finance the acquisition with a combination of cash on hand and committed debt financing.

In conjunction with this financing, the company’s board of directors has approved a change in the dividend policy to reduce the Xerox annual dividend from $1 per share to 50 cents starting with the dividend expected to be declared in the first quarter of next year.

"This lowered dividend payment provides incremental capacity to reduce debt while continuing to reward shareholders with an above-market yield," it said.