The US Securities and Exchange Commission has reported the sale of almost 2 million more shares over the past four trading days, to interests of Carl Icahn, taking his stake to over 34 million shares, or 21.9% of the stock. Currently at between US$16 and $17, Xerox shares have dropped dramatically and are about half of what Fujifilm offered in the abortive take-over offer in 2018.

Carl Icahn Xerox
Always an activist investor - Carl Icahn is Xerox's biggest shareholder


Since buying into Xerox, Carl Icahn has periodically bought further shares when stock price drops trigger his buy orders. US analysts are reporting that Xerox is under-valued and a take-over target - with HP being mentioned as a likely buyer. The tell-tale signals include an attractive yield of 5.43% per share and that Xerox has repurchased a huge number of shares itself over the past 4 years. Priced in the 'high teens' in US dollars, analysts suggest that Xerox stock is under-valued.

What other tech companies apart from HP could be interested in Xerox at these low prices? The natural candidate would be Fujifilm again, to get back under its control its American sales channels. Recently stung by Agfa's buying Inca Digital from under its feet, Fujifilm will be a lot more attentive with Xerox.

Ricoh would have much to gain in a buyout of Xerox, as would Konica Minolta. Canon is probably not in the mood having only recently absorbed the Oce buyout. Then, there are always the Private Equity funds, still awash with cash.

Whatever the outcome, one thing is for sure and that is that Carl Icahn, no matter how many more under-valued shares he buys, will ultimately be a seller.


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