Rumour: Lexmark for sale?
September 26, 2024
Ninestar considers selling Lexmark as VC-backed merger talks and regulatory challenges stir industry-wide speculation. The potential $3.6 billion (€3.4 billion) sale reflects ongoing pressures from geopolitical tensions and evolving regulations in Europe.
Rumours are circulating that Ninestar Corporation is exploring the sale of Lexmark, according to industry insiders and reports from Bloomberg and other media outlets. This potential move comes as the global printing industry struggles with shrinking demand and geopolitical hurdles, prompting Ninestar to possibly reassess its strategy regarding Lexmark, which it acquired for $3.6 billion (€3.4 billion) in 2016. As the whispers of a sale grow louder, sources close to the matter suggest that venture capital (VC) firms could be circling with interest, possibly driving a merger between Lexmark and another key player in the sector: Xerox.
The idea of a VC-backed merger between Lexmark and Xerox, both longstanding giants in the enterprise printing market, is gaining traction. Such a merger could create synergies for both companies, combining Lexmark’s strong managed print services and cloud-based solutions with Xerox’s cutting-edge digital printing and document management innovations. For venture capitalists looking to consolidate the fragmented printing industry, this could offer a pathway to extract value from two legacy brands facing declining market share.
The logic behind this rumoured merger is also strategic: both companies have been heavily impacted by the ongoing digitisation of workflows, eroding demand for traditional office printing hardware. By pooling resources, a merged entity could streamline operations and position itself to better compete in an industry undergoing rapid transformation. Additionally, a combined Lexmark-Xerox entity would likely have a stronger negotiating position when facing Europe’s increasingly complex regulatory environment.
In recent months, Ninestar has been taking steps to free up capital, including a $126 million sale-and-leaseback of Lexmark’s Lexington, Kentucky headquarters?. There are also rumblings that Ninestar plans to open a facility in Hungary, potentially to address forthcoming European legislation around environmental sustainability?. Such a move could make Lexmark more attractive to buyers or investors by ensuring compliance with evolving EU laws on e-waste and sustainability.
Ninestar and Lexmark have yet to confirm any rumours, conversations or discussions about a sale, but the combination of declining industry demand, complex regulatory frameworks, and the potential for geopolitical complications—especially following the U.S. Department of Homeland Security’s banning of Ninestar subsidiaries?—could push the deal forward. If a merger with Xerox were to materialise, it would likely mark one of the largest consolidations in the print sector in recent years, creating a dominant player that could navigate the industry’s turbulent waters with renewed strength.
As the rumours of this possible deal continue to swirl, the only certainty is whether the print and imaging sector is possibly on the verge of significant change. But then, as they say in media circles, don’t let the facts get in the way of a good rumour generated story.
Categories : City News
