(Bloomberg & WXXI News) Xerox has agreed to sell its information technology outsourcing business to French computer-services provider Atos for $1.05 billion, giving the U.S. company more funds for acquisitions and shareholder returns.
Atos will pay for the deal in cash, and Xerox may get another $50 million payment based on the condition of certain assets when the transaction closes, the companies said today in separate statements. Because of the sale, Xerox raised its fourth-quarter adjusted earnings forecast by 2 cents to as much as 30 cents a share.
Xerox Chief Executive Officer Ursula Burns is trying to refocus the company on higher-margin business services to help offset the decline of document printing, which was once the company’s biggest source of revenue.
Xerox said it plans to use some of the $850 million in initial proceeds to boost share buybacks and acquisition spending.
The business being sold includes about 9,800 employees in 45 countries. A Xerox spokesman tells WXXI News that while the ITO group is not based in Rochester, there are a couple of hundred employees that work in this area that could become ATOS employees when the deal is completed.
The deal is expected to close in the first half of 2015, after which Atos will provide IT services to Xerox, the companies said.