Xerox will buy printer maker Lexmark International, one of the Norwalk company’s suppliers, in a $1.5 billion deal. It will acquire the company from its current owners, China’s Ninestar Corp., PAG Asia Capital, and Shanghai Shouda Investment Centre.
Xerox says the acquisition of the Kentucky-based manufacturer will strengthen its core print portfolio and help build its global managed print services business. The Connecticut company has recently seen its revenue shrink as it competes with rivals like HP and Canon.
The combined company will have more than 200,000 clients in 170 countries, as well as 125 manufacturing and distribution facilities in 16 global locations.
The deal also brings Lexmark’s ownership back to the U.S. The company was sold to Chinese investors in 2016 in a deal then valued at $3.6 billion.
Xerox says the transaction strengthens its presence in the growing market for A4 color printing, a common format for home offices, and diversifies its distribution and geographic presence, particularly in the Asia-Pacific region.
Xerox expects to finance the acquisition with a combination of cash on hand and debt financing. To facilitate this, the Xerox Board of Directors approved a reduction in the annual dividend from $1 per share to 50 cents per share beginning in the first quarter of 2025.
The deal is still subject to regulatory approvals, and will be put to a vote of Ninestar’s shareholders.
It is expected to close in the second half of 2025.
