Japan's Ricoh to buy Ikon Office for $1.6 bln

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TOKYO, Aug 27 (Reuters) - Japanese copier and printer maker Ricoh Co Ltd said on Wednesday it would acquire U.S. office equipment distributor Ikon Office Solutions for about $1.62 billion to help it expand overseas.

Ricoh, which competes with Xerox Corp, Canon Inc and Konica Minolta Holdings in printers and copiers, said it would pay $17.25 cash for each Ikon Office share, a premium of 11 percent over Tuesday's close of $15.56.

Ricoh said in a statement the deal had been approved by the boards of both companies but was subject to regulatory approvals in the United States, Canada and Europe.

It will finance the transaction with a mix of internal and external funding and expects the deal to close in the fourth quarter of 2008, Ricoh said.

Ricoh has been using acquisitions to expand outside the Japanese market, which it still counts on for about half of its sales.

Ricoh said in January 2007 it would pay $725 million to buy IBM's digital commercial printer business and also recently acquired the European operations of copier service and supply company Danka Business Systems.

Its rivals have also been buying up overseas assets.

Earlier this year Konica clinched a deal for Danka's U.S. unit to boost its sales in the world's largest office equipment market and has also formed an alliance with Dutch photocopier and printer maker Oce NV.

(Reporting by Kiyoshi Takenaka; Editing by Quentin Bryar)

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