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Xerox Shares Under Pressure As Co.'s Largest Individual Investor Has Sued To Block Split

Xerox Shares Under Pressure As Co.'s Largest Individual Investor Has Sued To Block Split

Xerox Corp (NYSE: XRX) shares came under pressure after the biggest individual shareholder, Darwin Deason, preferred a lawsuit blocking the company from splitting into two public traded firms. He is said to be holding about 6.1 percent stake in the company.

Interestingly, other biggest institutional investor, Carl Icahn, whose firm holds close to 10 percent stake, pledged support for the split.

In his lawsuit, Deason pointed out the agreement that Xerox reached in 2009 when the company purchased Affiliated Computer Services. The transaction was done with cash and stock valued at approximately $6 billion. He charged the company of violating the deal.

Related Link: John Stumpf And 15 Major CEO Departures In 2016

According to a Dow Jones report, Deason charged Xerox of exchanging $300 million worth of preferred shares for a stake in the legacy business rather than Conduent. He believes that the planned split placed his investment at a significantly low-growth firm with diminishing outlook.

However, the company termed the lawsuit as "meritless" and expressed confidence in completing the split on schedule.

Following this, the stock traded at $9.56, losing $0.24, or 2.40 percent.

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