By Andy Slawetsky – In a decisive move, Xerox Holdings Corporation (Nasdaq: XRX) has announced the repurchase of all shares held by the billionaire activist investor Carl C. Icahn and his affiliates. This transaction, valued at approximately $542 million, not only signifies Xerox’s intention to regain control but also showcases its commitment to reshaping the future, focusing on the company more than the stock.

For many who’ve closely followed Xerox’s journey over the years, this decision symbolizes a moment of rejuvenation. Carl Icahn, renowned for his assertive and often aggressive investment strategies, has indeed been instrumental in guiding Xerox through its numerous transitions. His push for cost-cutting measures and his pursuit of consolidation within the printing industry were pivotal in streamlining Xerox’s operations.

However, there’s an underbelly to Icahn’s involvement: Xerox was stripped down, sometimes painfully, to its core. He’s chased out Xerox CEOs. He went to war with their biggest competitor (HP) in a hostile takeover bid. He dominated the board and was responsible for cutting 10s of thousands of jobs. While this downsizing potentially led to short-term profits, there remained concerns about the company’s long-term innovation, growth, and commitment to its partners, especially the resellers.

With the repurchase of shares from the Icahn Parties, Xerox has initiated a promising phase. One of the most significant beneficiaries of this move will likely be the resellers. Here’s why:

1. Renewed Focus on Innovation:

With a refocus on the company’s core, there’s an expectation that Xerox will recommit to its legacy of innovation. This is good news for resellers, who rely on cutting-edge products and solutions to cater to evolving market demands. In fact, a great deal of new sellable technology making use of AI was on display at their recent dealer conference in Miami.

2. Stability and Confidence:

The repurchase signifies stability. Resellers prefer doing business with stable partners, and Xerox’s decision to buy back its shares and fund the transaction with a new debt facility indicates confidence in its financial health and long-term strategy.

3. Enhanced Partner Relationships:

Without the pressing need to appease activist shareholders, Xerox can work on strengthening its relationships with its partners. Resellers can anticipate better engagement, training, and support as Xerox looks to reestablish its market leadership.

For Xerox customers, this development heralds an era where the focus might shift from mere profitability to value addition. Customers can anticipate more tailor-made solutions, an emphasis on sustainable technology, and enhanced post-sale services.

Steve Bandrowczak, Chief Executive Officer of Xerox, aptly highlighted the sentiment, stating the repurchase is “reflective of the confidence we have in our business, our strategy and our ability to improve Xerox profitability and cash performance.” This confidence will undeniably trickle down to every stakeholder, from resellers to end-users.

The buyback signals more than just a change in stock ownership. It’s a statement of intent. Xerox, an iconic brand with over 100 years of legacy, is ready for its next chapter. For the vast network of resellers and millions of customers, the hope is that this chapter will be marked by renewed dedication, innovation, and unparalleled value. With Icahn out of the picture, Xerox will hopefully find stability a renewed dedication to their customers.

SOURCE Industry Analysts Inc.