Shares of Xerox Corp. (NYSE: XRX) jumped nearly 16% in afternoon trading hours after it completed the spilt into two companies.
Around one year ago, Xerox planned to split into two parts, the business services and copier and printer business. According to the terms of separation, on December 31, Xerox shareholders received one common share of Conduent, which is formerly Xerox’s business-services unit, for every five shares of Xerox’s common stock they held as of the close of the transaction on December 15.
In addition, Jeff Jacobson will be the new chief executive of Xerox for Ursula Burns, and Xerox received cash transfer of $1.8 billion from Conduent, which will be used to pay off $2 billon debt.
While shares of Xerox jumped high today, shares of Conduent dropped 4.7% to $14.2 per share in the morning trading hours.
“Today is an historic day for Xerox. The successful completion of the separation sharpens our market focus and commitment to our customers,” said Jeff Jacobson. “I am confident the transformational actions we are implementing position Xerox for long-term success and unlocks shareholder value.”
Before the separation of the company, Xerox suffered from declining sales. The company has seen drop of annual sales and net income every year dating back to 2011, and declined around $2.5 billion in revenue from 2011 to 2015. Currently, the company is searching for ways to improve the current situations, including cutting jobs and improving operational efficiencies as part of the transformation. The upgrading of analysts from Credit Suisse and JP Morgan also pushed the shares of the company higher.