FedEx Corporation said after the close of regular trading Monday that it will stop using FedEx Kinko's name on its copy and office service store and record a charge of about $891 million to change its name of FedEx Office.
The Dallas-based business service called it a strategic decision to remove Kinko's from the retail chain's name, and the charge is broken down into a $515 million charge for the use of the trade name, $367 million in goodwill and $9 million in other expenses.
The company said the name Kinko's is no longer suitable for the store as it fails to describe the services available.
The name FedEx Office more accurately represents our broader role of providing superior information and services,'' Brian Philips, the unit's chief executive officer, said in the statement. ``We are a back office for small businesses and a branch office for medium to large businesses and mobile professionals.''
FedEx acquired Kinko's in 2004 for $2.4 billion in a bid to enter the retail arena and better position itself to compete with rival UPS. There are about 1,900 FedEx Office locations worldwide, up from 1,200 when it was first acquired.
Earlier this year, the company reduced future capital commitments by slowing the rate of expansion from about 300 locations in fiscal year 2008 to about 70 in fiscal 2009.
The FedEx board declared a quarterly cash dividend of 11 cents a share, or a 1-cent increase, on FedEx common stock. The dividend is payable July 1 to stockholders of record at the close of business on June 13.
Shares of FedEx finished Monday trading down 1.2 percent at $90.65 on the New York Stock Exchange.