Lexmark International

Lexmark International is an office equipment manufacturer headquartered in Lexington, Kentucky (USA).

Business in Russia

2022: Leaving Russia with the sale of the Russian office of the Marvell Group company

On August 5, 2022, it became known that the parent company of the Russian electronics distributor Marvel Distribution, F-Plus Equipment and Development, bought out the Russian division of the American printer manufacturer Lexmark. The value of the transaction was not disclosed. Read more here.

2011: Opening an office in Russia

In November 2011, Lexmark International announced the opening of a new regional office in Moscow. It is expected that the new office will help cope with the growing demand for the company's products in Russia and the CIS. The new office is scheduled to open at the end of the fourth quarter of 2011.

"The Russian economy is now at a stage of active development, which is confirmed by the growing demand for our products, and allows us to consider one Russia of our priority markets. We are planning further investments in order to become one of the key players in the Russian market. The opening of our office in Moscow is the first and very important step towards the goal, "said Emmanuel Jan, Lexmark CEO for Russia and the CIS.

"Lexmark's decision to establish an office in Moscow will allow us to work even more actively with partners in this region. This confirms the company's commitment to meeting the requirements of our growing customer base in this region, "added Danny Molhoek, Lexmark's Central and Eastern Europe lead.

1994: Start of work through distributors

Lexmark has been on the Russian market since 1994 through distribution organizations.

History

2019: Allen Uogerman - Lexmark's new CEO

On May 21, 2019, printing equipment maker Lexmark announced the appointment of Allen Uogerman as the company's new president and CEO. Read more here.

2017: Agreement with Nuance Communications

Lexmark International entered into an agreement with the manufacturer of software for digitization and document processing Nuance Communications in May 2017, under which it received the right to sell and distribute several key products of the latter. The agreement is global and includes AutoStore, Equitrac Office/Express and SafeCom software.

2016

Sale of the company to the Chinese Apex Technology

On April 19, 2016, the sale of Lexmark was officially announced. The American printer manufacturer agreed to buy a group of Chinese investors.

Printer components manufacturer Apex Technology, private equity group PAG Asia Capital and state corporation Legend Holdings buy Lexmark at a price of $40.5 per share of the company, which corresponds to $2.54 billion. Taking into account Lexmark's debts, the purchase of this vendor will cost the Chinese consortium $3.6 billion, reports The Wall Street Journal. ^[1]

By the close of the New York Stock Exchange on April 19, 2016, the value of one Lexmark share was $34.66. After the announcement of the sale of the company, its securities rose by 11.3% to $38.57. Compared to October 2015 quotes, when Lexmark announced the start of a "strategic study" regarding the possible sale of assets, Lexmark's value was 30% higher.

Chinese buy Lexmark for $3.6 billion

The deal to sell Lexmark was approved by the board. Shareholders and regulators should express their decisions, after which the Chinese will officially be able to become full owners of the company. Lexmark says "no significant barriers are expected from regulators."

After closing the deal, scheduled for the second half of 2016, Lexmark CEO and Chairman Paul Rooke will remain in charge of the company that changed owners. Lexmark's headquarters will continue to be located in Kentucky (USA), and divisions and regional offices will continue to operate. At the same time, the company will strive to increase its presence in the Asia-Pacific market, Ruk said.

Apex Technology Chairman Jackson Wang said the purchase of Lexmark should help his company realize "unfulfilled opportunities for future growth."

Preparing the company for sale

In April 2016, it became known about the possible sale of Lexmark to the Chinese manufacturer of chips for cartridges Apex Technology. This information came to the disposal of the Reuters news agency.

According to his knowledgeable sources, by early April 2016, Apex was in talks with Lexmark over the acquisition of the US company. The latter considers the offer of the Chinese promising, but intends to obtain guarantees from them that Apex will be able to close the deal.

Chinese want to buy Lexmark

At the same time, Apex has serious intentions in relation to Lexmark: in preparation for the acquisition, the Chinese vendor attracted one of the American investment banks, and also enlisted the support of a number of credit organizations in the Celestial Empire, sources say.

One of them knows that in April 2016, Apex top executives will fly to the United States to meet with Lexmark management in order to sign an agreement. At the same time, there is no confidence in the effectiveness of negotiations between companies. Apex and Lexmark did not comment on the information that appeared about the deal at the request of Reuters.

In October 2015, Lexmark announced the recruitment of Goldman Sachs Bank specialists to "explore strategic alternatives." In particular, the possibility of selling the entire company or part of it (for example, a software business or a hardware division) began to be considered. As of April 14, 2016, the market capitalization of the printing equipment manufacturer is about $2.15 billion.

Reuters notes that the potential deal with Apex is an opportunity for Lexmark management to sell the entire company. Attempts have already been made to sell Lexmark, but they were unsuccessful. The agency reported that Lexmark did not receive offers that would fully suit the owners of the company in the price issue.^[2]

2015

Losses and staff reductions

On February 23, 2016, Lexmark published a financial statement and announced the upcoming job cuts. The printer manufacturer also spoke about the process of exploring strategic options for further business development, among which the possibility of selling the company is being considered.

At the end of 2015, Lexmark's revenue amounted to $3.55 billion against $3.7 billion a year earlier. The company showed a net loss of $40.4 million, while in 2014 it received a net profit of $79.9 million. Operating loss reached $24.5 million.

Lexmark Year Totals: Losses from strong dollar and rejection of inkjet printers

Lexmark reports that the company's withdrawal from the inkjet printer market and the high dollar exchange rate are having a negative impact on financial performance. Among the positive factors, the vendor considers a decrease in costs and an increase in sales of enterprise software.

As noted by Lexmark CFO Paul Rooke, in 2015 the company doubled its profit margin from business software and recorded the 16th consecutive revenue growth in the Managed Print Services (MPS) market.

Along with the release of the financial results, Lexmark announced a 4% reduction in headcount. In 2016, it is planned to lay off about 550 people as part of a restructuring aimed at increasing revenues in the Imaging Solutions and Services division (responsible for the production of laser printing devices and consumables, as well as the provision of MPS services).

Having spent about $59 million on this business transformation, Lexmark hopes to save $67 million in 2016, and in the future - another $100 million annually. It is noted that restructuring is carried out in the process of studying strategic alternatives.

Earlier, Reuters reported that Lexmark management was negotiating the sale of the company, but it was not satisfied with any of the proposals of potential applicants.

According to Paul Rooke, Lexmark is "very pleased with the progress made and positive interest in the company's process of exploring strategic alternatives, the evaluation is ongoing."^[3]

Lexmark bought Kofax for $1 billion

On March 24, 2015, Lexmark announced the purchase of Kofax, with the help of which the company hopes to significantly expand the software business in the corporate segment.

The cost of acquiring Kofax is $1 billion or $11 per share, which is 47% more than the exchange mark of $7.5, which was reached by the company's securities at the close of trading on March 24, 2015.

2014: 3x profit drop

In late 2015, Lexmark International published its 2014 financial statement. The company's profit has more than tripled, and over the past three months, a loss has been recorded at all.^[4]

According to the released data, in 2014, Lexmark's net income was $79.1 million, or $1.28 per share, against $261.8 million, or $4.16 per security of the company, a year earlier. In October-December 2014, the printing manufacturer ended with a net loss of $25.6 million, or 42 cents per share, while in the same period of the previous year there was a net profit of $94 million, or $1.51 per share.

In 2014, Lexmark's profit fell 3 times

Lexmark's declining revenue remains impacted by the company's abandonment of inkjet printers in 2012. In addition, currency fluctuations affect. These negative factors were partially offset by high sales of laser printing devices and enterprise content management software (directed by Perceptive Software).

According to Lexmark Chief Executive Officer and President Paul Rooke, in 2014 the impact of leaving the jet equipment market turned out to be stronger compared to changes in exchange rates, but in 2015 the situation will change diametrically opposite.

In 2014, Lexmark's revenue grew by 1% - from $3.67 billion in 2013 to $3.71 billion a year later. The company earned $821 million from comprehensive printing management services, which is 14% more than in 2013.

Paul Rooke noted that the recorded sales were above the company's forecasts. "We're still growing," the top manager added.

At the end of 2014, Lexmark's operating profit amounted to $149 million, while a year earlier it was measured at $409 million. Operating profit margin for the same period fell almost three times - from 11.2% to 4%. Operating expenses increased from 1 billion to $1.3 billion.

Notes