Fujifilm Might Get Xerox but Icahn Still Wins

Its been a long campaign since Carl Icahn first disclosed his efforts to oust the Xerox board back in December 2017. He laid it on thick back then, making no apologies in comments to the WSJ, “[it’ll] go the way of Kodak if there aren’t major changes.” Icahn then partnered up with Darwin Deason to urge Xerox to explore their strategic options, i.e. sell the company. They weren’t too pleased with the lack of disclosures around the accounting scandal-ridden Xerox Fujifilm JV.

When Fujifilm upped the ante to buyout Xerox entirely, it didn’t exactly pass the smell test. Under the deal Jeff Jacobson, the poor-performing Xerox CEO, would get to keep his job putting into question the directors’ independence. But Icahn, never one to step over a penny in the street, successfully lobbied Xerox to bail on the deal.

By May, Xerox had an agreement with Icahn and Deason, and they got 5 new directors on the board and Jeff Jacobson was escorted out of the building figuratively speaking (maybe.)  While Icahn was out on the town promoting Xerox to a broader audience of acquirers, by July, Fujifilm filed suit to force Xerox back to the table claiming by settling with Icahn and Deason they didn’t allow other shareholders to weigh in on the deal.

Although going up against Icahn is a strategy doomed to fail, Fujifilm got at least one judge to agree. October 17th, the NY Appellate Court overturned the deal-blocking injunction. Did Fujifilm forget there’s a new management and board now. They’re going to want a hire price so Fujifilm will have to pay more. So even when Icahn loses, he wins.


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