Xerox is splitting itself into two different firms - hardware and services - the Wall Street Journal first reported. The news was later confirmed by CNBC.
The split comes after pressure from activist investor Carl Ichan, who will get three board seats in the services company as part of the new structuring. In November, Icahn disclosed an 8 percent stake in Xerox and said he would seek talks to improve the future of the company.
"We think this is a major move and will greatly enhance shareholder value," Icahn told CNBC. "I have had several meetings with [CEO] Ursula Burns and applaud and respect her for doing what she believes shareholders want -- just as John Donahoe did with eBay and PayPal."
With a market cap sitting at $9.3 billion, the stock was down roughly 1 percent in after-hours trading when the news broke. Xerox is one of the original names in the computing space, having invented cutting edge technology like desktop computing and the computer mouse.
Xerox declined to comment on the news.