Xerox Holdings Corporation (NASDAQ: XRX) has entered a Forward
Funding Agreement with PEAC Solutions to drive the continued growth
of Xerox’s FITTLE business.
FITTLE is a leading global provider of equipment leasing and
financing solutions for businesses. Its unique expertise in dealer
and vendor financing programs provides valuable solutions to
industries with increasing growth in capital spending, such as IT
services, office equipment, and 3D print.
PEAC Solutions is a portfolio company of the Asset Value Funds
sponsored and managed by leading global investment firm HPS
Investment Partners.
Under the Forward Funding Agreement, FITTLE has the option to
sell eligible pools of lease receivables, which PEAC Solutions is
committed to purchase on a monthly basis. FITTLE will continue to
service the lease receivables for a specified fee and will be paid
a commission on lease receivables sold. The Forward Funding
Agreement primarily covers U.S. direct originations and has an
initial term of one-year, with automatic one-year extensions
thereafter, unless terminated by either party. FITTLE expects to
sell lease receivables, which would otherwise have been funded by
Xerox, totaling approximately $600 million during the initial
term.
"Since FITTLE's inception, we have been dedicated to being a
best-in-class provider of leasing services and solutions, and this
strategic shift in our business model will drive our next phase of
growth. With the majority of our future origination volume expected
to be funded by third parties, we can expand the financing of our
valued business customers and partners, and free up capital for
Xerox," said FITTLE's President Nicole Torraco.
“Our new strategic partnership with FITTLE demonstrates PEAC
Solutions’ innovative leasing capabilities, identifying us as a
leading partner to both vendors and captive finance providers. This
new partnership represents an exciting opportunity for both FITTLE
and PEAC and is one more step in executing PEAC’s growth
initiatives,” said Global CEO of PEAC Solutions Bill
Stephenson.
Xerox and FITTLE are exploring similar forward funding
arrangements for other portions of FITTLE’s portfolio of future
lease receivables, which are expected to provide incremental growth
opportunities for the FITTLE origination platform.
Xerox expects proceeds from the Forward Funding Agreement to
more than offset a use of free cash flow to fund continued
year-over-year growth of FITTLE originations in 2023. Xerox coupled
this new funding solution with an opportunity to reduce the
commitments under its revolving credit facility by 50 percent and
eliminate its quarter-end minimum liquidity requirement.
Accordingly, the amendment to Xerox’s credit agreement provides
cost savings on the facility, which has never been drawn.
Mizuho Americas acted as exclusive financial advisor to FITTLE
in connection with the Forward Funding Agreement.
About Xerox Holdings Corporation (NASDAQ: XRX) For more
than 100 years, Xerox has continually redefined the workplace
experience. Harnessing our leadership position in office and
production print technology, we've expanded into software and
services to sustainably power today's workforce. From the office to
industrial environments, our differentiated business solutions and
financial services are designed to make every day work better for
clients — no matter where that work is being done. Today, Xerox
scientists and engineers are continuing our legacy of innovation
with disruptive technologies in digital transformation, augmented
reality, robotic process automation, additive manufacturing,
Industrial Internet of Things and cleantech. Learn more at
xerox.com.
About FITTLE The equipment financing business of Xerox
Holdings Corporation, rebranded FITTLE in 2022, is a leading
provider of innovative business financing and payment solutions to
help businesses adapt and grow. We offer dealer and vendor
financing programs for a range of offerings including IT Services,
software, audiovisual and security hardware, 3D printing equipment
and other business technologies. FITTLE enables innovation and
growth through value-add solutions such as bundled billing for
support, supplies and maintenance. We currently serve over 150,000
customers in 18 countries, in addition to managing more than
700,000 leases, and drive solutions for more than 1,000 dealers and
network partners around the world. Learn more at FITTLE.com.
About PEAC Solutions PEAC Solutions is a multi-national
asset finance platform, operating in 12 countries across Europe,
the United Kingdom and the United States. We specialize in
originating and servicing high-volume, small-ticket leases and
loans with a variety of end users, as well providing innovative
finance solutions to equipment manufacturers, distributors, dealers
and vendors. As at December 2022, PEAC Solutions had over 800
full-time employees globally and maintained a portfolio of
approximately USD 5.1 billion across multiple asset classes,
including business equipment, plant and heavy machinery and working
capital loans.
Forward Looking Statements This release and other written
or oral statements made from time to time by management contain
“forward looking statements” as defined in the Private Securities
Litigation Reform Act of 1995. The words “anticipate”, “believe”,
“estimate”, “expect”, “intend”, “will”, “should”, “targeting”,
“projecting”, “driving” and similar expressions, as they relate to
us, our performance and/or our technology, are intended to identify
forward-looking statements. These statements reflect management’s
current beliefs, assumptions and expectations and are subject to a
number of factors that may cause actual results to differ
materially.
Such factors include but are not limited to: the effects of
pandemics, such as the COVID-19 pandemic, on our and our customers'
businesses and the duration and extent to which this will impact
our future results of operations and overall financial performance;
our ability to address our business challenges in order to reverse
revenue declines, reduce costs and increase productivity so that we
can invest in and grow our business; our ability to successfully
develop new products, technologies and service offerings and to
protect our intellectual property rights; reliance on third
parties, including subcontractors, for manufacturing of products
and provision of services and the shared service arrangements
entered into by us as part of Project Own It; our ability to
attract and retain key personnel; the severity and persistence of
global supply chain disruptions and inflation; the risk that
confidential and/or individually identifiable information of ours,
our customers, clients and employees could be inadvertently
disclosed or disclosed as a result of a breach of our security
systems due to cyberattacks or other intentional acts or that
cyberattacks could result in a shutdown of our systems; the risk
that partners, subcontractors and software vendors will not perform
in a timely, quality manner; actions of competitors and our ability
to promptly and effectively react to changing technologies and
customer expectations; our ability to obtain adequate pricing for
our products and services and to maintain and improve cost
efficiency of operations, including savings from restructuring and
transformation actions; our ability to manage changes in the
printing environment like the decline in the volume of printed
pages and extension of equipment placements; changes in economic
and political conditions, trade protection measures, licensing
requirements and tax laws in the United States and in the foreign
countries in which we do business; the risk that multi-year
contracts with governmental entities could be terminated prior to
the end of the contract term and that civil or criminal penalties
and administrative sanctions could be imposed on us if we fail to
comply with the terms of such contracts and applicable law;
interest rates, cost of borrowing and access to credit markets; the
imposition of new or incremental trade protection measures such as
tariffs and import or export restrictions; funding requirements
associated with our employee pension and retiree health benefit
plans; changes in foreign currency exchange rates; the risk that
our operations and products may not comply with applicable
worldwide regulatory requirements, particularly environmental
regulations and directives and anti-corruption laws; the outcome of
litigation and regulatory proceedings to which we may be a party;
and any impacts resulting from the restructuring of our
relationship with Fujifilm Holdings Corporation. Additional risks
that may affect Xerox’s operations and other factors are set forth
in the “Risk Factors” section, the “Legal Proceedings” section, the
“Management’s Discussion and Analysis of Financial Condition and
Results of Operations” section and other sections of Xerox Holdings
Corporation's and Xerox Corporation’s combined 2021 Annual Report
on Form 10-K and combined Quarterly Reports on Form 10-Q, as well
as in Xerox Holdings Corporation’s and Xerox Corporation’s Current
Reports on Form 8-K filed with the Securities and Exchange
Commission.
These forward-looking statements speak only as of the date of
this release or as of the date to which they refer, and Xerox
assumes no obligation to update any forward-looking statements as a
result of new information or future events or developments, except
as required by law.
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Xerox® is a trademark of Xerox in the United States and/or other
countries.
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version on businesswire.com: https://www.businesswire.com/news/home/20230104005938/en/
Media: Justin Capella, Xerox, +1-203-258-6535,
Justin.Capella@xerox.com
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