Xerox's (XRX) New BPO Unit to be Christened Conduent

Information technology services provider Xerox Corporation XRX recently unveiled the names of the companies to be formed following its split into two publicly traded entities. Its Business Process Outsourcing BPO firm would be renamed as "Conduent Inc.", while its Document Technology (DT) division would retain the Xerox brand name.

Conduent

Conduent means conducive, and the name is derived from the company's expertise in providing seamless customer care, transportation solutions, and healthcare payer and provider services. The name further reflects the relentless pursuit of the company to deliver a culture of innovation, diversity and integrity for the satisfaction and retention of its clienteles.

With the second largest market share in the BPO industry, Conduent will offer transaction-intensive processing, analytics and automation services to a diversified client base. These include about two-third of the insured patients and over half of the mobile phone subscribers in the U.S.

The Namesake

With a diverse portfolio of hardware, software and support services that generated approximately $11 billion in revenues in 2015, the DT business will continue to serve its clients under the Xerox brand name. The company will offer industry-leading document and content technology and applications, managed print services and workflow solutions across the globe.

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Ursula Burns, the serving chairman and CEO of Xerox, will continue to serve as the Chairman of the refurbished namesake entity, while Ashok Vemuri will serve as the CEO of Conduent. Xerox intends to file its initial Form 10 registration statement with the Securities and Exchange Commission in July and complete the entire separation process by the end of the year.

Moving Forward

The separation will help Xerox in segregating its hardware operations and services business, with each functioning as an independent, publicly traded company. We remain impressed with the focused attempts of this Zacks Rank #3 (Hold) stock to fuel its growth momentum.

Some better-ranked stocks in the industry include ExamWorks Group, Inc. EXAM, Sajan, Inc. SAJA and WageWorks, Inc. WAGE, each carrying a Zacks Rank #2 (Buy).

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