Xerox shares fell 4% today after the photocopier pioneer said it had scrapped a planned $6.1 billion deal to merge with Fujifilm Holdings. 

The decision hands victory in one of the biggest ongoing US proxy fights to activist investors Carl Icahn and Darwin Deason, who say they can secure better offers for the company than the deal with Fujifilm. 

Some Tokyo-based analysts warned a long renegotiation of price, terms and how attempts to restructure the pair's existing joint venture could damage both companies. 

The two companies agreed in January to a complex deal that would have merged Xerox into their Asia joint venture Fuji Xerox and given Fujifilm control. 

That prompted Icahn and Deason, who control 15% of the company, to demand changes to the board. 

The settlement with the billionaire investors outlined by Xerox on Sunday puts the Japanese company further on the back foot in any new negotiations with Xerox, although a number of analysts have said Fujifilm is under no pressure to rush. 

Xerox said it had repeatedly tried to convince Fujifilm to start talks on improved terms for buyout to no avail.

Fujifilm said it had disputed Xerox's right to terminate the deal and would look at all options including legal action seeking damages. 

Icahn and Deason have said they believe other investors are "waiting in the wings" for Xerox.

People familiar with the matter have previously said that buyout firm Apollo Global Management has expressed interest in a bid for Xerox.