Xerox fights for survival

Amidst rumors that the company's European operations may file for bankruptcy

protection, struggling Xerox said it lost $167 million in the third quarter as

sales dropped 4 per cent to $4.46 billion. Xerox chairman Paul Allaire said the

results were "quite obviously not acceptable.''

Xerox is tackling the crisis by selling assets and cutting expenses,

including layoffs. Reportedly among the items up for sale is the renowned Palo

Alto Research Center (PARC), where many great computer inventions, including the

laser printer, mouse and graphics users interface, have sprouted, few of which

Xerox has been able to capitalize on. Xerox is looking for a partner to take a

stake in PARC and get access to its innovations.

Also for sale are Xerox's China operations, its ownership in a joint venture

with Fuji, and its interest in spin-offs such as ContentGuard and Inxight. Xerox

is also looking for investors in its inkjet printer business.

Xerox does not expect to see a turnaround until next year. In all, the

company wants to cut $1 billion in costs and sell up to $4 billion in assets.

Analysts expect the company to lay-off around 5,000 workers. Xerox is also in

danger of losing its independence as shares sank to below $9 a share. A takeover

attempt of Xerox is widely expected.