Fujifilm threatens to compete against Xerox if partnership not renewed
- 28 June, 2018 07:00
Fujifilm has threatened to compete against Xerox in Asia Pacific and challenge it in America and Europe if it failed to renew its technology agreement in 2021.
Xerox had said it would start sourcing products from new vendors to lower its dependency on Fujifilm and may not renew the agreement with the 56-year-old joint venture Fuji Xerox.
In a letter to Xerox's newly appointed CEO, John Visentin, Fujifilm CEO Shigetaka Komori said, "While Xerox presently has no marketing facilities here in Asia Pacific, we have global infrastructure that we can utilise for marketing worldwide.
"It would be enormously costly and difficult for Xerox to gain business in Asia Pacific.”
Fuji Xerox, 75 per cent owned by Japan's Fujifilm and rest by Xerox, handles contracts that supply global clients with Xerox services in the United States and Europe, as well as Fuji Xerox services in Asia.
As reported by Channel Asia, Fujifilm sued Xerox last week for well over US$1 billion, faulting the printer and copier company for succumbing to pressure from activist investors Carl Icahn and Darwin Deason in calling off a proposed merger agreed in January.
In a letter to Komori, Visentin, cited "massive and ongoing accounting fraud at Fuji Xerox" and "numerous contractual breaches" as grounds to not renew the joint venture when it expires in 2021.
“Simply put, Fujifilm has failed to prepare Fuji Xerox to comply with the laws and regulations applicable to U.S. public companies, and, as you and your advisors are surely aware, it would likely take years for any such compliance capability to be achieved," Visentin said in the letter.
In response, Fujifilm said Xerox's argument on Fuji Xerox's accounting issue is wrong. "The accounting issue at Fuji Xerox is properly resolved and no longer exists."
Xerox was not immediately available for comment outside regular business hours.
(Reporting by Sonam Rai in Bengaluru; Editing by Anil D'Silva)