Xerox announced Friday that it is splitting the company into two. One will be a $7 billion business services entity, and the other will be an $11 billion document technology firm.

The office equipment manufacturer revealed that the completion of the split is expected at the end of this year. Along with the separation, the company will undertake a three-year restructuring program to enable the company to save $2.4 billion.

"Today Xerox is taking further affirmative steps to drive shareholder value by announcing it will separate into two strong, independent, publicly traded companies," says Ursula Burns, Chairman and CEO,  in a company statement.

She also added that since their markets are rapidly evolving, the split will enable the two companies to have better chances of taking the leadership position in their respective industries.

The split, she said, will also help the two companies capitalize on the present opportunities so that they can increase their market shares and consequently their profit margins as well.

It will also give billionaire investor Carl Icahn three board seats on the business services company.

Icahn revealed in November that he has a stake in Xerox. At that time, he held discussions with the copying machine manufacturer about its future. Now, with a stake in the company of about 8.1 percent, Icahn's hedge fund appears to be the one of the company's largest shareholder, second only to the Vanguard Group.

"We are pleased to have reached an agreement with Mr. Icahn that ensures that we will have strong leadership and best-in-class governance for the new Business Process Outsourcing company that will be created by our separation plan," says Burns.

Xerox's market value is only about half of its approximately $20 billion annual sales. Company shares dropped one-fourth of their value in 2015 and has fallen 13 percent this year and ended at $9.23 on Thursday.