This might seem a large premium to pay for a company with $1bn revenues, but the acquisition will affords Xerox the rare opportunity of a double whammy: it not only gets its products into a major US reseller, but also gets to oust those of its competitors.
Tampa, Florida-based Global targets the SMB market in 32 states and the District of Columbia, reselling and servicing equipment from a wide range of vendors that include Canon, HP, Kyocera, Lexmark, Sharp, and Toshiba. A spokesperson for Xerox, which is headquartered in Stamford, Connecticut, said it would continue to sell these lines immediately after the deal closes. We expect that longer-term, they’ll derive a large portion of their revenue from Xerox, she said.
However, she said that all those names are in its digital imaging business, where of course Xerox is a major player. Global also sells products under the information systems banner from the likes of 3Com, AT&T, Novell, and Symantec, and presentation systems (overhead projectors and the like) from companies such as Hitachi and InFocus, none of which will be impacted by the Xerox deal.
In the short term, we’ll benefit from all Global’s revenue, including what it sells of our competitors’ products, she said. Nonetheless, from the day after the deal closes, Global will also be offering the Xerox alternatives.
