March 17, 2009 / 6:25 PM / 10 years ago

UPDATE 1-Lexmark expands distribution, sets Microsoft pact

NEW YORK, March 17 (Reuters) - Lexmark International Inc LXK.N said on Tuesday it would sell its computer printers in a wider range of office supply retail stores, in an effort to boost sales to small businesses.

The computer printer maker, which competes with bigger rivals like Hewlett-Packard (HPQ.N) and Canon (7751.T), said its printers and supplies will be distributed through chains such as Staples SPLS.O, Office Depot ODP.N and OfficeMax OMX.N.

The plan comes as Lexmark works to build sales to high-volume users, who print many pages, use lots of ink and toner and often also sign up for printing services.

The company in January posted an 82 percent decline in quarterly profit. It expects a revenue decline in the mid- to high-teens percentage range during the first quarter, as the recession hurts computer-related purchases.

Separately, Lexmark also signed a patent cross-licensing deal with Microsoft (MSFT.O), covering a broad range of products, including Lexmark printers and multifunction products, and Microsoft software products.

Shares of Lexmark rose 33 cents, or about 2 percent to $16.69 in afternoon trade on the New York Stock Exchange on Tuesday. Microsoft shares on Nasdaq rose about 1.9 percent to $16.55. (Reporting by Franklin Paul; Editing by Derek Caney)

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