Words From IKON's Espe - Internal IKON Memo

Memo to the crew, from Espe...

"Today we announced the exciting news that IKON is to be acquired by Ricoh Company, Ltd., subject to the satisfaction of customary closing conditions. A copy of the press release we issued is attached for your information. As you know, Ricoh has been one of our valued equipment partners for many years and we are thrilled that we will now be joining forces with them to create a stronger global office solutions competitor.

Let me explain why we chose to take this important step. As our Board and management looked at the future of our company, we focused on how going forward we could best meet our customers’ needs, deliver value to our shareholders and create opportunities for our employees. We decided that, like many of our competitors, we would be better able to achieve these goals as part of a larger organization that was able to offer a full range of end-to-end office solutions and services to more customers across the globe.

We believe that as part of a combined company in the highly competitive and evolving office equipment industry, we can leverage our sales, service and marketing depth with Ricoh’s engineering and manufacturing expertise to better understand and more rapidly respond to the needs of our customers. In addition, we anticipate that this transaction will create new opportunities for our employees, as you will be working for a larger organization with enhanced growth prospects.

The unmatched expertise and strong skills of IKON’s people were a significant reason why Ricoh wanted to acquire IKON and they are very much looking forward to working with our team.

Following the completion of the transaction, Ricoh intends to operate IKON as an independent subsidiary and has no immediate plans to merge or consolidate the organizations or to make any changes as a result of this transaction. Of course, we will remain committed to serving all our customers and we have every intention of continuing to provide them with world-class service and support, regardless of the equipment they use.

While we are very excited about today’s news, it is important for you to know that it will take several months to complete this transaction. In the meantime, it will be business as usual for us. We anticipate that the transaction will close before the end of calendar year 2008. From now until then, it is critical that we all stay focused on selling, servicing and meeting the needs of our customers, and achieving our objectives to finish the fiscal year strong...

...I’d like to end by thanking you for your continued hard work and dedication to IKON. It is your contributions that have made our company an attractive partner for Ricoh and I am confident that if we all can continue to focus on what we do best, we will all have a very bright future to look forward to as part of the new Ricoh.

Matt"

Here is the Press Release.

The Death of the Copier Dealer - Rise of the "Hybrid"

The Death of The Copier Sales Person

The Death of The Copier Dealer

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A Return to Selling

Ricoh to Buy IKON - Shot Heard Around the World

The other shoe has dropped.

In an announcement today, Ricoh stated that they have "reached a diffenative statement to purchase IKON through it's wholly owned U.S. distribution subsidiary, Ricoh Americas Corporation."

"IKON has terrific strength in areas that complement RICOH's growth strategy," said Shiro Kondo, President and CEO of Ricoh Company, Ltd. "IKON has advanced Professional Services capabilities with a long list of satisfied large customers. IKON is respected as well for its production print sales and service expertise. We are excited to add the very experienced IKON management team and the thousands of skilled and dedicated IKON employees to the RICOH family."

IKON Chairman and Chief Executive Officer, Matthew J. Espe, said, "Following an extensive review of our strategic opportunities, our Board conducted a formal process to evaluate alternatives for the Company, and has approved this attractive transaction for our shareholders, customers and employees. The offer represents a 33% premium over IKON's trailing 60-day average stock price as of market close on August 26th. In addition, combining with RICOH, one of the world's most respected and innovative companies, will enable us to strengthen our offerings to customers and create new opportunities for our employees."

Espe concluded, "We remain fully committed to providing the highest quality of support and service to all our customers."

WOW! This is BIG.

33% premium? Try $1.6 billion! That's it. Was it a fire sale?

A missed opportunity for HP. A bargain price for huge channel for copiers and printers - 14 billion they spend on EDS.

So now, one question answered and oh so many more are asked.

What about ALL of the IKON Canon customers? Will it be a feeding frenzy as competitors start picking away at Canon, Kyocera and Konica Minolta installs?

My oh my...

"Ikon eliminated about 350 jobs in January to trim costs after first-quarter profit fell 45 percent. The company has also reduced executive bonuses as sales fell for 11 straight periods through the third quarter of 2007.

Canon Inc., the largest Japanese office equipment maker, has lost about 50 percent of its U.S. distribution network as the distributors have been bought by printer makers. Xerox Corp. bought Global Imaging Systems for $1.67 billion last May to expand its small- and mid-sized business sales. Konica Minolta Holdings Inc. bought London-based Danka's U.S. unit for $240 million in June.

``The biggest question is what Canon's response will be,'' said Cross. ``Does another bidder emerge?'' Canon spokeswoman Patricia Hall declined to comment.

Ikon, the largest U.S. distributor of Canon and Ricoh copiers, is being advised by Goldman, Sachs & Co., while Morgan Stanley is advising Ricoh." - Bloomberg

"Canon machines represent 60 percent of the products Ikon handles at the moment, with Ricoh machines accounting for 30 percent.

But Ricoh aims to replace Canon products with its own printers and copiers in three to four years, Chief Financial Officer Zenji Miura said."

Yikes - "another bidder"? This could get oh so much more interesting...


more to follow...

RICOH to Acquire IKON Office Solutions, Inc.

Ricoh in $1.6B deal for Ikon

My Older Posts:

Excerpts From Espe

I Know One Name - Canon

Should HP Purchase IKON's PS Division? - Delicious!!

IKON Introduces New Printer Line

Ricoh - A great, American Company? - Great ? yes, American? sorta...

HP gets the Dems, Xerox the Elephant...

Interesting...

Xerox Named Exclusive Provider of Document Services for Republican National Convention

HP Named Official Mobile Solutions Provider for Democratic National Convention

...

‘Shopping spree' raises questions for county

When questioned, Skeans and Foust both admitted they "didn't know anything about it" and even went so far as to say they "never use a color copier."

What... did the Earth just go through the tail of a comet?

What is with all the "goofy" copier related stories? again, fact is funnier then fiction.

From the local news in the The Wabash Plain Dealer Online, an article by By SHEILA RHOADES-

"In a move that could be perceived as reckless government spending, the Wabash County Health Department has committed $13,725 in Homeland Security grant funds to more office equipment..."

It seems that the local health department down there had received some money from Homeland Security and "...only had one day to spend it...".

So of course, they went on a "shopping spree" - it's the American way.

And along this way, they seemed to have purchased a "...used photocopier machine..." for $9,000.00.

Huh?

"When questioned, Skeans and Foust both admitted they "didn't know anything about it" and even went so far as to say they "never use a color copier."

"Do you know what that costs for ink for that? And it would cost about 65 cents a copy," Commissioner Lester Templin said. "And you're not even going to use half of the things that are on there (copy machine). And it says on this paper that this is a 'repo unit'," he added."

OMG!

Seriously, this is funny.

"Beware of DLL, a business nightmare..."

Bad Leasing Story part Trios...or is it quatre It's gotta be bad if the very first line in the article is, "The following is a fictitious account of a business nightmare."

And it must be true if the names HAVE NOT BEEN changed, to protect the innocent.

This article from a paper in Philly, written by John F. McKenna an attorney with MacElree Harvey of West Chester, goes on to describe a bad experience with DLL.

"About DLL

Based in the Netherlands, DLL is a global provider of leasing, business and consumer finance solutions. They are listed as a Michigan corporation with United States headquarters in Wayne.

DLL never guarantees the performance of the equipment; it merely provides the financing. You are responsible for the payments regardless of the performance of the equipment, even if it never works."

I have a copy of their contract, and it is "standard" but is very one sided - as the article states :

"The standard contract states that you cannot have a jury trial. You further agree, that in the event of default, DLL can declare the entire balance of the unpaid lease payments for the full term immediately due and payable."

"payments for the full term immediately due and payable" - you gotta love that too.

His last two sentences sum up nicely,

"Sometimes you just have to take a risk when you lease equipment. Clarifying upfront what your duties and obligations are is always a good course of action."

I notice in the comments this guy takes some pretty good hits, but the overall information is valid.

Leasing is tough all over.

Bad Experiences with Leasing - Toshiba, IKON, Canon, Saxon

Again With The "Leasing"! Enough!