Ricoh to acquire IBM Printing Systems Divison

Jan 25, 2007 12:04 PM

Ricoh and IBM have announced the formation of a joint venture based on IBM’s Printing Systems Division.

Upon the closing expected in Q2 2007, Ricoh will acquire 51 percent of the joint venture, which will be called the InfoPrint Solutions Company. Ricoh will progressively acquire the remaining 49 percent over the next three years as the joint venture evolves into a fully owned subsidiary of Ricoh.

"This agreement is key to Ricoh's efforts to become a leading global provider of output and print solutions," says Masamitsu Sakurai, President and CEO, Ricoh. “We will invest the necessary resources to make InfoPrint Solutions Co. into a core business. Building on our long association with IBM, we look forward to creating an infrastructure that can address complex solutions and mission-critical environments."

IBM will receive $725 million in cash upon closing, which includes a management fee of $35 million. The cash received is consideration for the initial 51 percent acquisition of the joint venture by Ricoh as well as a prepayment for the remaining 49 percent to be acquired and certain royalties and services to be provided by IBM to the InfoPrint Solutions Company. Final consideration for this transaction will be determined at the end of the three-year period based upon the participation in the profits and losses recorded by the equity partners.

InfoPrint Solutions Co. is expected to begin operations with about 1,200 employees. IBM will continue to provide maintenance services to InfoPrint Solutions Company clients under a service agreement.

InfoPrint Solutions Company's worldwide headquarters will be located in Boulder, CO, currently the headquarters of the IBM Printing Systems Division. Tony Romero, GM of the IBM Printing Systems Division, will head the new company as president and CEO.

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