Xerox acquires Lexmark for $1.5 billion as legacy print giants consolidate

[Shawn Knight]

The big picture: Xerox has closed its deal to acquire Lexmark in what would have been a landmark acquisition just a couple of decades ago. Instead, the $1.5 billion buyout has largely flown under the radar and is seen by some as a last-ditch effort to remain afloat.

Xerox announced plans to buy Lexmark late last year, but you're forgiven for not hearing about it at the time. To their credit, the two printing giants still have loads of brand recognition worldwide. The problem is that most consumers have long since moved on from at-home printing, leaving what is left of the industry to enterprise sectors like finance, healthcare, and government.

There are still needs to be met, clients to be served, and money to be made, but it's nowhere near as lucrative as it was before the digital revolution and the shift from computers to mobile devices.

Nevertheless, Xerox is looking to the future. The company said its combined business will serve more over 200,000 clients across more than 170 countries around the globe, and operate approximately 125 manufacturing and distribution facilities in 16 countries.

Xerox CEO Steve Bandrowczak is sticking around and will continue to run the company, but Lexmark president and chief executive Allen Waugerman is stepping down. The executive said leading Lexmark has been an incredible opportunity, adding that he looks forward to the accomplishments that lie ahead.

Xerox financed the deal with a combination of cash on hand and debt, and said it expects it to be accretive next year. By the end of the second year, Xerox anticipates roughly $240 million of transaction-related cost synergies.

Lexmark was founded in early 1991 and became a publicly traded company in 1995. The business peaked in the early 2000s, and it's been mostly a downhill ride ever since. Lexmark exited the inkjet printer business in 2012 and eventually went private in 2016.

Xerox, which pioneered the photocopier industry, has been around since 1959. Like Lexmark, its value hit an all-time high around the turn of the century.

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Xerox acquires Lexmark for $1.5 billion as legacy print giants consolidate

 

[Megalomaniac]

What's really keeping printing alive is the school industrial complex.

Public schools could save millions by giving the kids tablets or Chromebooks. Many offices have done this already to cut costs.

 

[RudyBob]

Why print at home when you can steal from work? I will never forget the day my boss asked me if I knew anything about the 50 pages of Duke Nukem stuff on the printer

 

[DZillaXx]

Sharp and Kyocera have been the MFP I've seen most.

In the business work paper is still widely used. As a Control Engineer I still prefer to mark stuff up on printed out P&ID sheets than do it on my iPad.

 

[AnilD]

This feels like two retired rock bands from the 90s announcing a reunion tour and expecting fans to still care. The nostalgia is real, but so is the irrelevance.

Somewhere in an office basement, a dusty printer just woke up in excitement.

 

[Theinsanegamer]

Oh great, MORE consolidation of industry titans. That's just what we need.

I wonder if Xerox will be as incompetent at providing support? Lexmark is a frustrating tour of bullet points and step by step procedures with manuals missing about half the information needed to do a job, as in entire steps are straight up missing.

What's really keeping printing alive is the school industrial complex.

Public schools could save millions by giving the kids tablets or Chromebooks. Many offices have done this already to cut costs.

SAVE millions? Bruh, chromebooks ain't free.

Our school district has around 20,000 kids, and maintaining enough chromebooks, with the rate they break them, is costing roughly $1.5-2 million per year (roughly 6000 broken chromebooks per year at $300 per device). That's not counting the broken ones fixed with parts from the other ones.

And good luck getting modern parents to cough up the dough when their kid breaks something.

There's also the consideration that pen and paper has been documented producing higher test scores and better knowledge retention then using a computer, and it's immune to the AI shenanigans available to students today.

 

[p51d007]

I've been in the copier business for over 40 years (tech NOT sales).
In the early 90's the government passed the paperwork reduction act. People told me copiers were
going away, find another job. We sell more copiers now, than we did 30 years ago!
With machines today, you "only" need one box to copy, scan, print & fax. Yes, FAX! We sell
more fax boards today, than we did when fax machines were a separate box! We do a LOT of
schools. 2 years ago, one school got over 130 machines. Just this past month, we did 70 machines
for another school, and are in the middle of doing 20 for another school, not counting the city, state
government agencies, churches, and (production level) print shops.
A lot of our machines are used to scan documents for storage or email.
Personally, I wish government would come up with a "one stop" approach to email to make it a
legal document so fax would DISAPPEAR. With the advent of VoIp, most of our machine will
work ok on ATA box/VoIp setups, but some we have to slow down the speed to 14.4k over 33.3k.
Yes, slow big time! But I know one hospital told me that if you type an email address incorrectly,
it COULD still go somewhere, but, what would the odds be that you dial a number incorrectly and
it be a fax line. Most faxing we sell in MFP (multifunction printer) are doctors, hospitals, pharmacies
that want to avoid HIPAA violations.
Our volumes seem to go up, every time government, be it federal, state, or local, introduces a
"new law".

 

[SRB]

What's really keeping printing alive is the school industrial complex.

Public schools could save millions by giving the kids tablets or Chromebooks. Many offices have done this already to cut costs.

What make you think they aren't??? The schools around my area give every student a chromebook. Trust me, it's not necessarily for the better.

 

[wiyosaya]

I have a Xerox Color Laser Printer. when the toner runs out, I'm buying a Brother MF color laser printer and getting rid of a Canon MF monochrome laser.

I used to have a Lexmark Laser printer at one time and got rid of it, too, because the toner was more expensive than the printer when it was new.

All I have to say about this merger is "Oh Great! More overpriced printers and consumables." Just what the world needs.

 

[trents]

What's really keeping printing alive is the school industrial complex.

Public schools could save millions by giving the kids tablets or Chromebooks. Many offices have done this already to cut costs.

Most schools already have given kids Chromebooks.