Activist Escalates: STARTEEPO Urges Xerox to Explore Sale of the Whole Company as Shares Slide 9%
XRX sits 27% above its 52-week low of $1.19 on elevated volume (6.6× avg).
Summary
STARTEEPO, holder of 7.34% of Xerox, went beyond its prior push for a sale of the Xerox Financial Services unit and said in an open letter that a strategic alternatives review could include the company itself. The Prague-based fund also said it will significantly intensify its dialogue with management and the board after Thursday's weak Q3. Xerox reported a $1.02 billion net loss including a $959 million non-cash goodwill impairment and cut its full-year free cash flow and adjusted operating income outlook. The stock fell 9% to $1.52 by midday Friday, extending Thursday's slide and putting it down 36% year-to-date. STARTEEPO applauded the $174 million debt exchange and the dividend suspension but reiterated its view that Xerox could be worth $18 a share under strategic alternatives. The pressure now lands on a board that has already been formally asked once to review XFS, with the fund explicitly threatening to escalate.
At the time of this announcement, XRX was trading at $1.52 on NASDAQ in the Technology sector, with a market capitalization of approximately $198.9M. The 52-week trading range was $1.19 to $3.78. This news item was assessed with negative market sentiment and an importance score of 7 out of 10. Source: Dow Jones Newswires.