Xerox to split into two companies

Technology firm Xerox will split into two companies after pressure from activist investor Carl Icahn.

The firm will split into a document technology company - that will include Xerox's traditional photocopiers - and a business process outsourcing company.

Mr Icahn has been pushing the company to make changes to its corporate structure to boost shareholder value.

Xerox's shares price rose nearly 6% on Friday following the announcement.

The company has been reviewing ways to boost its share value since October.

In a statement Xerox's chief executive Ursula Burns said, "I am confident that the extensive structural review we conducted over the last few months has produced the right path forward for our company."

Under the terms of the deal, Mr Icahn will get to name three of the nine directors on the board of the business process outsourcing (BPO) company.

"We strongly believe that an independent BPO company with fresh, focused leadership and best-in-class corporate governance will greatly enhance shareholder value," Mr Icahn said.

That company will focus on automating and simplifying business processes for clients to try to help them cut overheads.

The other company will handle document technology including sales of the photocopiers and scanners for which the company is famous.

Both firms will be listed on stock exchanges, but the names of the new companies and their leaderships has not yet been announced.

Xerox also said it would undertake a "strategic transformation program" that would save $2.4bn (£1.7bn) in three years.

SOURCE BBC