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Xerox Corp. will purchase Global Imaging Systems Inc., an office-machines distributor, for $1.5 billion in order to jumpstart its slowed growth in sales. Global Imaging sells machines built by rivals of Xerox, including Canon Inc. and Ricoh Company, to small businesses. Xerox expects that over time it will be able to replace many of the products made by its competitors with its own machines. If it succeeds, the purchase of Global Imaging Systems may permit Xerox to enter a market that has thus far eluded the company. Canon, Ricoh, and others could look to other distributors, however, which would have a potentially negative impact on sales. According to Anne Mulcahy, chief executive officers of Xerox, the company has faced problems with growth since 2000. She believes the acquisition of Global Imaging Systems will help Xerox gain a portion of the small and midsize business market. Xerox has attempted to attract more dealers that sell to small businesses as it focused its attention on developing more competitive color laser printers and multifunction copiers. The firm has met with only limited success in these markets to date. Global Imaging Systems is expected to increase sales at Xerox by seven percent. In 2006, sales at Xerox grew by only 1.2 percent to a total of $15.89 billion. At its peak in 1999, Xerox grew to $19.55 billion.
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