SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (date of earliest event reported): March 5, 1998
XEROX CORPORATION
(Exact name of registrant as specified in its charter)
New York 1-4471 16-0468020
(State or other (Commission File (IRS Employer
jurisdiction of Number) Identification No.)
incorporation)
800 Long Ridge Road
P. O. Box 1600
Stamford, Connecticut 06904-1600
(Address of principal executive offices)(Zip Code)
Registrant's telephone number, including area code: (203) 968-3000
This document consists of 4 pages.
ITEM 5. OTHER EVENTS
Accelerating its strategy to achieve high growth through networked document
solutions, Registrant announced on March 5, 1998 an agreement to acquire
XLConnect Solutions, Inc. ("XLConnect"), an information technology services
company, and its parent company, Intelligent Electronics, Inc. ("Intelligent
Electronics"), for $415 million in cash.
Under the agreement, Registrant will acquire Intelligent Electronics, which
holds an 80 percent interest in XLConnect. In addition, Registrant will
acquire the 20 percent of XLConnect shares publicly held. Registrant will pay
$7.60 for each share of Intelligent Electronics stock and $20 for each share
of XLConnect stock. The transaction must be approved by the stockholders of
both Intelligent Electronics and XLConnect. Closing is subject to customary
closing conditions, including regulatory approval.
Registrant believes that this acquisition will strengthen its worldwide
services capabilities to design, build and support networks that implement
enterprise-wide document solutions for its customers. In addition, Registrant
believes that XLConnect's expertise will complement and extend Registrant's
highly profitable document services outsourcing business, which grew 58
percent in 1997, to $2 billion.
XLConnect, with 1,500 employees, 27 locations throughout the United States and
1997 revenue of $135 million, provides network management, consulting, design,
and integration services for medium and large companies.
The growth in network computing has led to a tremendous increase in both the
volume of digital documents and the convergence of document management and
communication with other technologies, including imaging, voice and data.
Registrant believes that this acquisition will infuse it with hundreds of
talented and trained network specialists who will design and build publishing,
workflow and other document solutions, including Internet-based solutions, for
its customers. Registrant believes the experts at XLConnect will help
Registrant develop and deliver its document solutions for virtually any
networked environment.
Registrant's digital printers, copiers and other document products, operating
in conjunction with a suite of document management, workflow and imaging
software, create networked business solutions that improve productivity in the
office, print shop and production-printing environments. With more than 40
percent of Registrant's revenues derived from digital products and services,
the purchase of XLConnect provides Registrant strategic access to a nationwide
information technology services capability, including applications developed
by XLConnect, that position Registrant at the forefront of the networked
enterprise.
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Timothy Wallace, currently president and chief operating officer of XLConnect,
will become president and chief executive officer of the newly acquired
company. XLConnect's senior management team will remain with the company.
XLConnect will have immediate access to Registrant's customer base, sales
force, products and outsourcing capabilities.
Registrant anticipates that the earnings impact from this acquisition will be
about neutral in 1998 and positive in 1999 and thereafter.
XLConnect, based in the Philadelphia suburb of Exton, Pa., provides a
comprehensive range of information technology services, including systems
consulting, design and installation, application development, help desk,
network management and outsourcing. Its services are designed to enable
clients to increase productivity and enhance competitiveness by improving the
flow of information among employees, clients and suppliers. Its customers
include Anheuser-Busch, John Deere, Eli-Lilly and Continental Airlines.
Strategic partners include Microsoft, IBM, and Novell. Its parent company is
Intelligent Electronics, which specializes in providing information technology
products, services and solutions to large and mid-sized companies,
governmental agencies, and educational institutions, using technology to
create efficiency.
The forward-looking statements and other information relating to Registrant
contained herein are based on the beliefs of management as well as assumptions
made by and information currently available to management. The words
"anticipate," "believe," "estimate," "expect," "intends," and similar
expressions, as they relate to Registrant or Registrant's management, are
intended to identify forward-looking statements. Such statements reflect the
current views of Registrant with respect to future events and are subject to
certain risks, uncertainties and assumptions. Should one or more of these
risks or uncertainties materialize, or should underlying assumptions prove
incorrect, actual results may vary materially from those described herein as
anticipated, believed, estimated or expected. Registrant does not intend to
update these forward-looking statements.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
Registrant has duly authorized this report to be signed on its behalf by the
undersigned duly authorized.
XEROX CORPORATION
/s/ MARTIN S. WAGNER
--------------------------------
By: MARTIN S. WAGNER
Assistant Secretary
Dated: March 6, 1998
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