Xerox negotiating $500m IP-backed loan, WSJ reports

Image: Courtesy of Xerox Corporation

According to the Wall Street Journal, office equipment and software company Xerox is in negotiations to arrange $500 million in debt finance using its intellectual property assets as collateral.

For many, Xerox is best known for pioneering the photocopier market with the launch of the Xerox 914 in 1959 and for its contributions to early computer development via its involvement with Xerox PARC at Palo Alto in California, where it developed the Xerox Alto computer in 1973, widely recognised as the first to use a Graphical User Interface (GUI), using pictures instead of text.

Xerox has faced significant financial challenges in recent years, as the WSJ highlights. However, the company still owns an estimated near 12,000 active patents, as well as roughly 1,400 trade marks.

In passing, it’s worth noting that the company has a track record of aggressively and successfully defending its core Xerox trade mark against people using it as a general term for photocopying. Such ‘genericide’ or trade mark erosion (the loss of legal trade mark rights) is a constant challenge for owners of popular marks such as Google and Lego.

The use of IP as collateral for loans has become much more widespread in recent years, particularly in the UK, where NatWest launched an IP-backed loan for high-growth IP-rich SMEs in January 2024, with support from Inngot’s online IP identification and valuation platform. HSBC also has a loan offer where IP can be used as collateral alongside other assets, again using Inngot’s online tools.

In Scotland, Royal Bank of Scotland, part of the NatWest Group, will be launching its version of the NatWest high-growth loan soon, following changes in Scottish law last April; the Moveable Transactions (Scotland) Act means IP (and other intangible assets) can now be used as collateral, in the same way as they can in England and Wales.