Xerox Completes Lexmark Purchase
Our take:
Xerox’s acquisition of Lexmark marks a defining moment not just for the two companies, but for the thousands of in-plants that have relied on Xerox technology for decades. With the $1.5 billion deal now closed, Xerox gains a powerful A4 portfolio, broader global distribution, and an expanded managed print services (MPS) footprint. But for in-plants that long thought of the company as a dominant force in production print, the discontinuation of the iGen and Nuvera lines combined with this Lexmark deal signals Xerox is no longer the same company that once blanketed in-plants with its digital presses.
This shift is strategic. Xerox says retiring older platforms allows it to focus on offerings better aligned with today’s hybrid workplace and economic buyers. That includes developing automation tools, Predictive AI, and continuing to support its remaining production digital presses like the Iridesse and Versant. The company is repositioning itself as a solutions provider, not just a print engine manufacturer.
For in-plants, this acquisition could bring more options in fleet management and office-level devices—but it also confirms that Xerox’s long-term growth strategy is no longer centered on high-volume production print.
The news:
Xerox Holdings Corporation completed its acquisition of Lexmark International, Inc. from Ninestar Corporation, PAG Asia Capital, and Shanghai Shouda Investment Centre. The transaction, valued at $1.5 billion inclusive of net debt and assumed liabilities, marks a significant milestone in the company’s strategic transformation and reinforces its commitment to delivering innovative workplace solutions in an evolving hybrid environment.
“We've long admired Lexmark’s strong print and managed print services reputation, robust client and partner base, and global presence. Over the years, we’ve built a collaborative partnership, and today, we take our business to the next level,” said Steve Bandrowczak, chief executive officer at Xerox. “Together, we will drive greater success for our clients and partners through a broader portfolio of Print and Managed Print solutions, furthering our Reinvention and solidifying our path toward long-term profitable growth.”
“Today is a pivotal moment for Xerox and Lexmark as these two great companies combine to shape the future of the printing industry,” said Allen Waugerman, who is stepping down as Lexmark president and chief executive officer with this close. “Leading Lexmark has been an incredible opportunity, and I look forward to the accomplishments that lie ahead.”
Steve Bandrowczak will remain CEO of Xerox with an executive team comprised of Xerox and Lexmark leaders. The unified leadership team is structured to accelerate innovation and scale, leveraging the deep bench of talent from both companies.
The combined organization will serve over 200,000 clients in over 170 countries and operate 125 manufacturing and distribution facilities in 16 countries.
"With the acquisition of Lexmark, Xerox now stands among the top five in every major print segment and is the market leader in managed print services. This strategic combination strengthens our core business by adding exposure to growing parts of the Print market, manufacturing capacity and expanding our distribution reach," said Bandrowczak. "The transaction accelerates our Reinvention by improving our mix of revenue from growing markets and further enabling long-term growth in adjusted operating profit through structural simplification. By uniting two complementary portfolios and deepening our capabilities, we’re better equipped than ever to deliver innovative, end-to-end solutions that drive success for our clients across every geography and industry."
Transaction Detail
The acquisition was financed through a combination of cash on hand and debt financing. The company continues to expect the transaction to be accretive to 2025 adjusted earnings per share and free cash flow and result in a lower level of pro forma gross debt leverage. Further, the company expects approximately $240 million of transaction-related cost synergies to contribute over $1/share of additional adjusted EPS accretion by the end of the second year following the transaction close.
