WSJ : Xerox CEO Negotiated Fijifilm Deal Despite Board's Order To Stop

(RTTNews) - Xerox Corp.'s (XRX) board told Chief Executive Jeff Jacobson in November to stop negotiations with Fujifilm Holdings Corp. (FUJIF.PK, FUJIY.PK) because it was considering firing him, the Wall Street Journal reported.

Instead, a newly amended lawsuit alleges, the executive raced to strike a complex deal that would leave him in charge, and cede control of the American icon to the Japanese company, a move that has been criticized by two of Xerox's biggest investors.

Though Xerox's board ultimately stuck with Mr. Jacobson after his performance improved and signed off on the deal he negotiated, communications disclosed Sunday in a lawsuit filed by billionaire investor Darwin Deason allege the CEO negotiated to sell the company—and keep his own job—while pushing the acquirer to help him avoid being ousted under pressure by Carl Icahn, his biggest investor.

Xerox's chairman, Robert Keegan said Sunday Mr. Jacobson was "fully authorized to engage in discussions with Fujifilm."

In January, Xerox announced a merger that would cede control to Fujifilm if completed. The deal would trade Xerox's 25% ownership of their 60-year joint venture to Fujifilm for 49.9% of a new company that combines all of Xerox with the joint venture. Xerox shareholders would also be paid $2.5 billion in a special dividend.