CNN Money reports Japan’s Fujifilm Holdings Corp. is seeking more than $1 billion in damages from Xerox in district court in New York, over the failed Fuji Xerox merger. The amount is significantly higher than the $183 million termination fee built in to the deal.
Fujifilm filed the following notice:
Notice of Filing a Suit for Damages against Xerox Corporation
FUJIFILM Holdings Corporation (the “Company”) announces that on June 18, 2018 (EST) the Company filed a suit for damages in the federal court for the Southern District of New York against Xerox Corporation (“Xerox”) claiming that the Xerox breached its agreements with the Company by making a unilateral decision to terminate without legitimate cause the agreements executed on January 31, 2018 to combine Fuji Xerox Co., Ltd. (“Fuji Xerox”) and Xerox.
The terms and conditions of the agreements were discussed in an appropriate manner, based on fair valuations from independent experts retained by both companies. A preliminary injunction against the transaction was issued by the New York State Supreme Court on April 27, 2018 (EST). The Company disagrees with the ruling and filed an appeal on May 4, 2018 (EST). The deliberations are expected to commence in September 2018.
The Company believes the combination of Fuji Xerox and Xerox is the best option for the future of both companies as it was designed to accelerate business growth and realize new value creation for customers through the deployment of operations based on a globally unified marketing strategy.
As reported earlier this year, Xerox was in position to merge with the existing Fuji Xerox joint venture, but activist investors Carl Icahn and Darwin Deason – who together hold 15% of Xerox shares – opposed the deal, saying it undervalued Xerox and gave too much control to Fuji.