Xerox sued by large investor over plan to split company
- Apple (AAPL) Tops Q4 EPS by 2c; Issues Solid Outlook
- Wall St. slips on earnings; Apple results due
- Chipotle Mexican Grill (CMG) Posts Q3 EPS of $0.27; Comps Miss Views; Additional Stock Buyback Approved
- Pandora (P) Misses Q3 EPS by 1c, Q4 Revenue Guidance Falls Short
- Panera Bread (PNRA) Tops Q3 EPS by 3c; Raises Outlook
The logo of Xerox company is seen on a building in Minsk, Belarus, March 21, 2016. REUTERS/Vasily Fedosenko
Get instant alerts when news breaks on your stocks. Claim your 2-week free trial to StreetInsider Premium here.
(Reuters) - One of Xerox Corp's largest shareholders sued the copier maker to block its plan for spinning off its document outsourcing business into a new publicly traded company.
Darwin Deason sued Xerox on Tuesday in a U.S. District Court in Dallas over the company's plan to divide its legacy copier and printer business from its business process outsourcing unit, which would become a new company called Conduent Inc.
Xerox said in a Thursday statement that Deason's lawsuit was meritless and the company would seek its dismissal.
The Conduent business includes the operations of Dallas-based Affiliated Computer Services Inc, the company that Deason founded and that was acquired by Xerox for $6.4 billion in 2010.
Xerox announced the split in January and also said at the time that activist investor Carl Icahn would get three Conduent board seats after the spin-off. Icahn disclosed his stake last November. Icahn Associates Corp owns 9.77 percent of Xerox and is the company’s largest shareholder, according to Thomson Reuters data.
Deason owns 6.1 percent of Xerox stock and is the company's largest individual investor and fourth-largest overall, according to Thomson Reuters data.
Deason's complaint said he obtained preferred convertible stock in Xerox as part of the ACS deal, and that stock will now be marooned in the legacy business after it spins off Conduent, which Deason said was the faster growing business.
Deason asked the court to block the separation of the Conduent business and to declare that depriving him of his right to receive a convertible stake in Conduent violated Xerox's certificate of incorporation.
Xerox said on Thursday it expects to complete the planned separation of the Conduent business on schedule and that the deal will enhance shareholder value.
(Reporting by Tom Hals in Wilmington, Delaware; Additional reporting by Michael Flaherty; Editing by Bill Trott)
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- American Paul Beatty's race satire wins Man Booker Prize
- Exclusive: Trump says Clinton policy on Syria would lead to World War Three
- Clinton warns supporters against complacency in U.S. election
Create E-mail Alert Related CategoriesReuters
Related EntitiesCarl Icahn
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!