Starteepo urges Xerox to conduct strategic review of financial services unit

STARTEEPO SICAV a. s., a Prague-based investment manager led by František Bostl, has increased its stake in Xerox Holdings Corporation to 7.34%. The fund has issued a letter to the Xerox board urging a formal strategic review of Xerox Financial Services (XFS).

STARTEEPO proposes several options for the financial services unit, including a joint venture, capital partnership, partial monetization, or a full sale. The investor argues that XFS could be worth approximately $7.69 per share on its own, which would be more than double Xerox’s total company share price at the time of the proposal. The fund is also calling for increased transparency regarding XFS's receivables, funding, and credit performance, requesting that the unit's financial results be reported separately.

In addition to the review of XFS, STARTEEPO is pushing for a reduction in leverage and a more disciplined approach to capital allocation. The investor suggests an optimized capital structure where a third party could provide funding for the financial services portfolio while Xerox maintains its servicing infrastructure and customer relationships. Following the news, Xerox shares saw a temporary rise of up to 6.9% in New York trading.