Xerox HQ to Remain in Stamford, Company Says

STAMFORD, CT-Xerox Corp., which on Oct. 24 reported a net loss of $167 million or 20 cents per share in the third quarter, will be engaging in a “turnaround program” to cut $1 billion in costs and asset dispositions that are expected to raise $2 to $4 billion. Including in its plan will be an unspecified number of workforce layoffs.

A year ago, the company reported net income for the third quarter of $339 million. While it did not report a specific number of job cuts, the company states that it is “substantially increasing the number of positions removed from the company.”

The struggling copier and business machine manufacturer will most likely reduce some staff at its headquarters operation in Stamford, but stresses it has no plans at the moment to relocate the entire headquarters operation to Rochester, NY, which had been the source of some speculation.

Xerox’s corporate headquarters is located at 800 Long Ridge Rd. The firm employs approximately 500 workers there, which totals 255,000 sf. Xerox owns the adjoining land at its Stamford headquarters property, but leases the office space from Stamfex Associates, LP. Xerox and Stamfex engaged in a sale/leaseback transaction in 1985, where Xerox eventually retained ownership of the approximately 23 acres of land, but sold the office building to Stamfex and then signed a lease for the entire building, according to a Xerox spokesperson.

“We have no immediate plans to leave this facility,” says Christa Carone, a company spokesperson. She later added that some workers at the Stamford headquarters could be shifted to Rochester or will be working out of field offices as part of its turnaround plan.

She notes that the company also employs “a handful of people” at other Xerox operations in Stamford, including Xerox Credit Corp., the company’s business equipment financing division, housed at 100 First Stamford Place. According to Bruce Crawford, vice president of leasing for the Northeast Region for TrizecHahn Office Properties, Xerox Credit Corp., currently leases 5,000 sf at the building, which is owned by TrizecHahn. He says that Xerox at one time had leased the entire adjoining building–200 First Stamford Place. He said the company moved out of the property, which totals 103,474 sf of space, about five years ago.

Carone says that Xerox Credit Corp., has 150 employees, however, most are working out of field offices across the United States and not at the headquarters in Stamford. Xerox officials say that it will be looking to exit the equipment financing business.

The company also said it is exploring a “joint venture with non-competitive partners” for its Palo Alto Research Center.

In announcing its third quarter results, Xerox Chairman and Chief Executive Officer Paul A. Allaire says, “It is clear that just fixing our operational issues, although critical, is not sufficient. We must fundamentally resize our cost base, cut our investment levels and significantly improve our balance sheet with asset sales and alternative means of providing customer financing.”

Xerox notes that it was actively in talks to sell the company’s China operations, a portion of the Xerox ownership in Fuji Xerox, Xerox Engineering Systems and its interest in spin off companies such as ContentGuard and Inxight. The company adds that it is in discussions with a number of possible equity investors in its ink jet business.

“Our actions are centered on improved cash flow and profitability — and at the same time strengthening our strategic core,” comments Anne M. Mulcahy, president and chief operating officer of Xerox. “These actions will be implemented in a disciplined and controlled manner, but we are moving forward with a sense of urgency.”