Xerox Moves to Dismiss Bankruptcy Talk

Xerox Corp. moved to squelch a rumor that it might file for Bankruptcy Court protection by issuing a statement that it has sufficient cash and reserves, including a $7-billion revolving credit agreement. The rumor circulated in European markets and pulled Xerox shares down 10% in early trading on the New York Stock Exchange to as low as $10, a price not seen on the stock since late 1991. The shares closed off 81 cents, or 7%, at $10.44. Xerox said company policy is to refrain from commenting on rumors, but said it was issuing a statement “in order to reassure the markets.” Xerox has been struggling to address a host of difficulties, including falling profit margins and competitive problems. The company recently warned that it would post a loss for the third quarter and slashed its dividend by 75%.