Xerox will acquire Chinese-owned printer company Lexmark for US$1.5 billion.
Lexmark offers printer software and cloud services as well as hardware, and is already a Xerox supplier.
“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 organization,” said Xerox CEO Steve Bandrowczak.
“By combining our capabilities, we will be better positioned to drive long-term profitable growth and serve our clients, furthering our Reinvention,” Bandrowczak said.
The combined company will serve more than 200,000 clients in 170 countries, according to Xerox.
Xerox projects the acquisition will deliver over US$200 million in cost synergies.
The deal is expected to close in the second half of 2025, and will be financed through both cash on hand and committed debt. Xerox has reduced its annual dividend to US$0.50 per share to aid with financing.
Lexmark was founded in the United States in 1991 and was sold to a consortium led by China’s Apex Technology in 2016. The company is prominent in the growing A4 colour printing market, a sector Xerox hopes to target.
Xerox’s (NASDAQ: XRX) share prices have been down more than 50% this year. However, its share price soared to US$9.45 today after the acquisition was announced, up from $8.39. Xerox’s market capitalisation is US$1.2 billion.