Xerox, a globally recognized leader in office and print technology, software, and workplace services, has agreed to acquire Lexmark International, a printer and imaging technology company headquartered in Lexington. The deal, announced in late December, is valued at $1.5 billion and was unanimously approved by the Xerox board of directors. It is expected to close in the second half of 2025, pending approval from United States and Asian regulators. Until then, the two companies will operate independently as decisions are finalized regarding how Xerox will integrate Lexmark’s staff and facilities.
The acquisition is expected to strengthen Xerox’s core print portfolio and expand its global managed print services business, according to the company. Xerox has faced declining sales in recent years, having missed financial analysts’ expectations for seven consecutive quarters as of last fall, according to Xerox Holdings Corporation.
“Reinvention” refers to Xerox’s strategic shift away from traditional printing and copying services toward expanding its focus on information technology services, workflow automation, and digital solutions. Lexmark, already a partner and supplier to Xerox, specializes in global imaging solutions and technologies, including printers and multifunction devices.
“Our acquisition by Xerox, another proud American company, marks the beginning of an exciting new chapter for both of us,” Allen Waugerman, Lexmark president and CEO, said in a statement to Business Lexington. “Together, we will harness our strengths to create a powerhouse that will drive growth and innovation, not just for our business, but for the communities where we live and work.”
The deal positions Xerox for long-term growth and profitability, said Zeus Kerravala, principal analyst for ZK Research based in Acton, Massachusetts. Xerox anticipates annual savings of $200 million in marketing and real estate expenses, among other areas. “That money can be reinvested for the future. Xerox has set itself up for the future,” Kerravala said in a Reuters report.
Business analysts say the world’s workplaces have undergone significant changes in recent years, transforming the print industry. Hybrid work is now the norm, and digital print solutions have become essential to meeting evolving business needs.
Lexmark currently employs approximately 950 people in Lexington, primarily at its New Circle Road/Newtown Pike campus, and about 8,000 employees worldwide. Xerox has not disclosed how the acquisition will impact Lexington, including whether all employees will remain or if Lexington will continue as a major hub for the company.
“As part of our integration efforts, the company will examine how the combined organization is structured globally and identify areas where operations can be streamlined,” said a Lexmark spokesperson.
Xerox plans to finance the acquisition through a combination of cash on hand and debt financing. The combined company will serve over 200,000 clients in 170 countries, with 125 manufacturing and distribution facilities across 16 countries. Combined, Xerox and Lexmark have a top-five global share in various print markets. Major competitors in the industry include HP and Canon.
Lexmark traces its origins to the arrival of International Business Machines, better known as IBM, in Lexington in 1956 to manufacture IBM electric typewriters. By 1985, IBM was among the major employers in Lexington, employing 6,000 workers and contributing to the city’s transformation from a college town to an emerging midsized U.S. city.
By 2016, Lexmark was facing challenges retaining corporate clients amid shifting consumer preferences toward mobile devices. That year, the company went private, acquired for $3.6 billion by a consortium of Asian multinational companies, primarily Chinese-owned. The Xerox acquisition will return Lexmark to U.S. ownership.
In addition to its headquarters in Lexington, Lexmark operates regional headquarters in Geneva, Switzerland, and Singapore, as well as research and development facilities in Cebu, Philippines, and Kolkata, India. The company operates support centers and field offices around the globe.
Lexmark’s Waugerman reflected on the transaction in a company blog post, writing that more than 30 years ago, he began on the factory floor of the Lexington IBM facility helping to produce typewriters and later keyboards.
“I never imagined that one day I would be leading this great company as president and CEO,” Waugerman wrote. “Today, I am pleased to usher in our company’s next great chapter. Make no mistake. This is not just about growing in size — it is about getting better and stronger. We are combining our expertise to accelerate innovation and deliver faster development cycles, more advanced features, and a world-class printing experience.”