Xerox Unhappy With Moody's Downgrade to Junk Status

Xerox(XRX) called a credit rating downgrade by Moody's "disappointing" in light of the company's turnaround plan.

Moody's today cut the company's senior unsecured debt to junk status. In response, the Stamford, Conn., copier and office equipment maker said its turnaround plan, which includes asset disposals, cost reductions and a refocusing of its core businesses, will allow its liquidity to remain sufficient.

According to a report, Xerox, which has been fighting off rumors of liquidity concerns in recent weeks, also handed out layoff notices this week to 200 workers in the Rochester, N.Y., area on top of 350 administrative staff who were let go last month.

In November, Xerox cut 350 jobs in the U.S., including 115 in Rochester. All of the recently announced job cuts are separate from the 5,200 layoffs that the company said in March would be carried out by April 2001.

Shares of Xerox closed lower by 9.9%, or 69 cents, to $6.25 in trading on the New York Stock Exchange.

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