Xerox Corp. reported on Monday a definitive agreement to acquire Affiliated Computer Services (ACS) in a cash and stock transaction valued at $63.11 per share or $6.4 billion.
Xerox said its purchase of ACS, a $6.5 billion business process outsourcing firm, would accelerate its growth in an expanding market.
"The revenue we generate from services will triple from $3.5 billion in 2008 to an estimated $10 billion next year," said Xerox CEO Ursula M. Burns in a press statement.
According to the agreement, ACS shareholders will receive a total of $18.60 per share in cash plus 4.935 Xerox shares for each ACS share they own. In addition, Xerox will assume ACS's debt of $2 billion and issue $300 million of convertible preferred stock to ACS's Class B shareholder.
Xerox said it expects to achieve annualized cost synergies that will grow to a range of $300 million to $400 million in the first three years following the close of the transaction.
The transaction is expected to close in the first quarter of 2010, with ACS operating as an independent organization.
The deal is subject to customary closing conditions, including regulatory and shareholder approvals.
