Xerox Corp. (XRX) announced that its wholly owned subsidiary, Global Imaging Systems (GIS) has acquired Iowa-based Midwest Business Solutions, Inc., for an undisclosed price, in order to strengthen its dealer and distribution network in the domestic market.
Based in Des Moines and Ft. Madison, Iowa, Midwest Business Solutions is an independent distributor of copiers, printers and multifunction systems. Following the acquisition, the company will start offering Xerox’s comprehensive line of office multifunction products.
This is GIS’s fourth acquisition in the current year and the second in Iowa itself. GIS acquired Iowa-based Premier Office Equipment, Inc. a month ago with the same objective. Apart from Premier Office Equipment, GIS also acquired Illinois-based United Business Solutions and Pensacola-based Florida Imaging & Network Systems.
Xerox Corp. is highly focused on expanding its footprint worldwide based on its well-knit distribution network. The company has also taken similar initiatives in the emerging economies as well.
In order to seize the opportunities in the emerging markets, Xerox partnered with Trigon last year to offer its authorized products for the first time in UAE. The company also teamed with Seven Seas, a UAE-based systems integrator and reseller, in order to expand its indirect channel business and boost its market share.
With all these agreements, contracts and acquisitions, Xerox aims to capitalize on the growing market in order to strengthen its financial performance in the upcoming quarters.
Xerox ended the first quarter of 2011 with revenues of $5.47 billion, up 16% from the year-ago level. The company’s adjusted net earnings were $334 million or 23 cents per share during the quarter compared with $224 million or 18 cents per share in the previous year. The company expects to perform well in the future based on its attempt to grow and expand its business, especially its Business Process Outsourcing business.
Consequently, Xerox has projected adjusted earnings in the range of 18 cents–21 cents per share for the upcoming quarter and $1.05 to $1.10 per share for full-year 2011. However, intensifying competition and availability of substitutes for the company’s products may put the company on the back foot.
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