STAMFORD, Conn., Xerox Corporation (NYSE: XRX), moving forward on its comprehensive business turnaround plan, today announced it has completed the sale of its China operations to Fuji Xerox Co. Ltd. for $550 million in cash. The company also indicated a softer fourth quarter performance is likely. "Closing the sale of our China operations to Fuji Xerox is the first in a series of asset dispositions that are a key element in our plan and designed to restore a sound financial foundation to the business," said Paul A. Allaire, Xerox chairman and chief executive officer. Xerox disclosed that it has successfully negotiated to extend the securitization of certain trade receivables that might have become due as a result of the December 1 Moody's Investor Services downgrade. This means that $290 million of the $315 million outstanding securitization facility will, at the company's current credit ratings, remain in place. Related to this, Xerox renegotiated a finance receivable securitization with the same third-party resulting in a $40 million partial repayment of outstanding principal. Xerox said it has drawn down the remaining balance of its $7 billion revolving credit agreement, a portion of which was used to repay maturing debt. Including proceeds from the China sale, the company's current cash balance is approximately $1.4 billion, up from $154 million on September 30. "These activities further strengthen Xerox's liquidity," said Allaire. "As we said when we announced our agreement to sell the Xerox China operations, our asset dispositions are on track and ahead of schedule and our cost reduction program is on track. And while we are confident for a turnaround in 2001, our fourth quarter performance is likely to be softer than the third quarter, especially in light of the current economic environment." The company's turnaround plan, announced in late October, includes the sale of assets totaling $2 billion to $4 billion, a $1 billion cost-reduction program and a focus on core growth businesses.