TOKYO -- Fujifilm Holdings has given up on its battle to acquire U.S. partner Xerox, the Japanese company announced on Tuesday. Instead, Fujifilm intends to bring Fuji Xerox -- a joint venture between the two -- completely under its own umbrella.
Fujifilm plans to buy out Xerox's 25% stake in Fuji Xerox for about $2.3 billion. The Japanese side already owns the other 75%.
The two groups have been locked in a standoff since Fujifilm announced its intention to buy the U.S. copier maker back in January of last year. The move triggered strong opposition from Xerox investors, including top shareholder Carl Icahn. After Xerox terminated the takeover agreement the two had reached, Fujifilm sued Xerox to seek damages. It will now withdraw the lawsuit.
Making Fuji Xerox a wholly owned subsidiary is expected to boost Fujifilm's annual net profit by around 20 billion yen ($183 million). The joint venture sells multifunction printers and provides a range of document services; the buyout means Fuji Xerox will have more flexibility to do business with clients other than Xerox on an original equipment manufacturing basis.
"Full ownership of Fuji Xerox will facilitate faster decision making in a rapidly changing business environment," Fujifilm Chairman and CEO Shigetaka Komori was quoted as saying in a statement.
The Japanese side plans to expand the business, building on expertise in cloud computing, artificial intelligence and the "internet of things." The goal is to increase Fuji Xerox's sales to 1.3 trillion yen in fiscal 2024, which would mark a 30% increase from last year.