Xerox's shares rose 3.4% in extended trading on the news.
Icahn, who last reported a stake of 12.9% in Xerox as of Sept. 9, had also built a sizable stake in HP around the time Xerox reached out to it for a merger.
HP Inc rebuffed Xerox's initial offers and Xerox went hostile with its bid but ultimately gave up the pursuit in March due to the coronavirus pandemic.
Icahn dissolved his shared share stake in HP as of the end of June, as per filings with the U.S. Securities and Exchange Commission.
(Reporting by Shariq Khan in Bengaluru; Editing by Vinay Dwivedi and Maju Samuel)