*NEWS*XEROX ACQUIRES GLOBAL IMAGING/$1.5B

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*NEWS*XEROX ACQUIRES GLOBAL IMAGING/$1.5B

 user 2007-04-02 at 10:21:00 am Views: 57
  • #17502

    Xerox To Acquire Global Imaging Systems For $1.5B
    Apr.  2007 Xerox dropped the hammer on a major acquisition Monday with a $1.5 billion cash deal to buy Global Imaging Systems, a Tampa, Fla.-based integrator and reseller of Ricoh, Konica Minolta and Sharp products.The Stamford, Conn.-based document technology giant will pay $29 per share for Global Imaging and expects the deal to close in May.For Xerox, the deal helps further its effort to grow sales to small and midsize businesses and represents a significant coup in that it’s taking over a large company that has partnered with some of its key rivals.In a conference call with financial analysts to announce the deal, Xerox Chairman and CEO Anne Mulcahy said she believed the acquisition would create no overlap between Xerox and its channel partners.Xerox in February launched a major initiative to align itself with a greater portion of the channel, instituting a new program for solution providers and resellers and committing itself to spending more on partners. Mulcahy said that since the Global Imaging deal is focused on growing Xerox’s sales in the SMB space, where the company has not been strong, she does not see potential for great channel conflict.”What we did [with the new channel initiative] was announce our intent to participate a lot more aggressively in the SMB market,” Mulcahy told analysts. “Part of that was adding tools and incentives for agents; part of it was expanding our reach with resellers as well as our product line. We think it’s very consistent with that. When you haven’t participated in 80 percent of the decisions [in the SMB space], quite frankly, there’s not a ton of overlap.”In its most recent annual report on file with the U.S. Securities and Exchange Commission, Global Imaging, which has about 200,000 customers, said that as part of its business, “we purchased approximately 20 percent, 19 percent and 11 percent of our equipment, parts and supplies from Ricoh and its family of products, Konica Minolta and Sharp, respectively.”After the Xerox deal closes, Global Imaging will become an independent unit of Xerox and begin to add key parts of Xerox’s product line, including its Phaser group of office products, into its lineup, the companies said.”Xerox is now positioned to compete and win in more of those [SMB] buying decisions,” Mulcahy said.Other Xerox executives are expected to provide more details about the deal later on Monday.