Fujifilm Holdings Corp. said Wednesday it will merge its subsidiary Fuji Xerox Co. with Xerox Corp. of the United States to boost growth, while at the same time saying Fuji Xerox will cut one-fifth of its global workforce.
The merger will enable Fujifilm "to formulate a consistent global and management strategy," Chairman Shigetaka Komori said at a news conference.
Ten thousand jobs will be slashed at Fuji Xerox as part of a broader reorganization as the company struggles with an "increasingly severe" market environment.
The firm also cut its forecast for operating income for the year ending March 31, with its outlook missing the lowest analyst estimate.
Fujifilm's joint venture with Xerox, Fuji Xerox, has been the subject of a recent accounting probe into its practices in New Zealand and Australia. That prompted activist investor Carl Icahn to call for renegotiating or scrapping their 55-year-old agreement.
Fujifilm will incur a one-time charge of ¥72 billion ($662 million) over three years, including a ¥49 billion charge in the second half of this fiscal year.
Fujifilm, which generates almost 60 percent of sales overseas, is pushing to offset waning demand at its printer and copier hardware business by shifting focus to managed-print services and medical imaging. The joint venture employs about 46,200, according to the company.