The ODP Corporation (“ODP” or the “Company”) (NASDAQ:ODP), a
leading provider of business services, products and digital
workplace technology solutions through an integrated B2B
distribution platform and retail locations, today confirmed that it
has received a proposal to acquire the Company from USR Parent,
Inc. (“USR Parent”), the parent company of Staples and a portfolio
company of Sycamore Partners.
Consistent with its fiduciary duties, ODP’s Board of Directors
is carefully reviewing the proposal in consultation with its
financial and legal advisors to determine the course of action that
it believes is in the best interests of the Company and its
shareholders. As part of its review, the Board is evaluating
various components of the proposal, including potential antitrust
and other regulatory challenges given USR Parent’s ownership of
Staples and past regulatory decisions blocking the combination of
the two companies, purchase price, and closing conditionality. The
Company noted that, according to its letter to ODP, USR Parent
expects the regulatory process to take at least six months.
While the Board review is underway, the Company and its
employees remain focused on positioning the business to deliver
value for stakeholders through the implementation of its strategy
to build upon the capabilities of its B2B platform, supported by
its “Maximize B2B” restructuring plan, to drive future growth,
achieve cost savings and pave the way for an enhanced competitive
profile that builds on its unique strengths.
ODP shareholders need take no action at this time.
Simpson Thacher & Bartlett LLP and Goldman Sachs & Co.
LLC are acting as legal and financial advisor to the Company,
respectively.
About The ODP Corporation
The ODP Corporation (NASDAQ:ODP) is a leading provider of
business services and supplies, products and digital workplace
technology solutions to small, medium and enterprise businesses,
through an integrated business-to-business (B2B) distribution
platform, which includes world-class supply chain and distribution
operations, dedicated sales professionals and technicians, online
presence, and approximately 1,200 stores. Through its banner brands
Office Depot®, OfficeMax®, CompuCom® and Grand&Toy®, as well as
others, the Company offers its customers the tools and resources
they need to focus on their passion of starting, growing and
running their business. For more information, visit
news.theodpcorp.com and investor.theodpcorp.com.
The ODP Corporation and Office Depot are trademarks of The
Office Club, Inc. OfficeMax is a trademark of OMX, Inc. CompuCom is
a trademark of CompuCom Systems, Inc. Grand&Toy is a trademark
of Grand & Toy, LLC in Canada. ©2020 Office Depot, LLC. All
rights reserved. Any other product or company names mentioned
herein are the trademarks of their respective owners.
FORWARD-LOOKING STATEMENTS
This communication may contain forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. These statements or disclosures may discuss goals, intentions
and expectations as to future trends, plans, events, results of
operations, cash flow or financial condition, the potential impacts
on our business due to the unknown severity and duration of the
COVID-19 outbreak, or state other information relating to, among
other things, the Company, based on current beliefs and assumptions
made by, and information currently available to, management.
Forward-looking statements generally will be accompanied by words
such as “anticipate,” “believe,” “plan,” “could,” “estimate,”
“expect,” “forecast,” “guidance,” “outlook,” “intend,” “may,”
“possible,” “potential,” “predict,” “project,” “propose” or other
similar words, phrases or expressions, or other variations of such
words. These forward-looking statements are subject to various
risks and uncertainties, many of which are outside of the Company’s
control. There can be no assurances that the Company will realize
these expectations or that these beliefs will prove correct, and
therefore investors and stakeholders should not place undue
reliance on such statements.
Factors that could cause actual results to differ materially
from those in the forward-looking statements include, among other
things, highly competitive office products market and failure to
differentiate the Company from other office supply resellers or
respond to decline in general office supplies sales or to shifting
consumer demands; competitive pressures on the Company’s sales and
pricing; the risk that the Company is unable to transform the
business into a service-driven, B2B platform that such a strategy
will not result in the benefits anticipated; the risk that the
Company may not be able to realize the anticipated benefits of
acquisitions due to unforeseen liabilities, future capital
expenditures, expenses, indebtedness and the unanticipated loss of
key customers or the inability to achieve expected revenues,
synergies, cost savings or financial performance; the risk that the
Company is unable to successfully maintain a relevant omni-channel
experience for its customers; the risk that the Company is unable
to execute both the Business Acceleration Program and the Maximize
B2B Restructuring Plan successfully or that such program and plan
will not result in the benefits anticipated; failure to effectively
manage the Company’s real estate portfolio; loss of business with
government entities, purchasing consortiums, and sole- or limited-
source distribution arrangements; failure to attract and retain
qualified personnel, including employees in stores, service
centers, distribution centers, field and corporate offices and
executive management, and the inability to keep supply of skills
and resources in balance with customer demand; failure to execute
effective advertising efforts and maintain the Company’s reputation
and brand at a high level; disruptions in computer systems,
including delivery of technology services; breach of information
technology systems affecting reputation, business partner and
customer relationships and operations and resulting in high costs;
unanticipated downturns in business relationships with customers or
terms with the suppliers, third-party vendors and business
partners; disruption of global sourcing activities, evolving
foreign trade policy (including tariffs imposed on certain foreign
made goods); exclusive Office Depot branded products are subject to
additional product, supply chain and legal risks; product safety
and quality concerns of manufacturers’ branded products and
services and Office Depot private branded products; covenants in
the credit facility; a downgrade in the Company’s credit ratings or
a general disruption in the credit markets; incurrence of
significant impairment charges; retained responsibility for
liabilities of acquired companies; fluctuation in quarterly
operating results due to seasonality of the Company’s business;
changes in tax laws in jurisdictions where the Company operates;
increases in wage and benefit costs and changes in labor
regulations; changes in the regulatory environment, legal
compliance risks and violations of the U.S. Foreign Corrupt
Practices Act and other worldwide anti-bribery laws; volatility in
the Company’s common stock price; changes in or the elimination of
the payment of cash dividends on Company common stock;
macroeconomic conditions such as future declines in business or
consumer spending; increases in fuel and other commodity prices and
the cost of material, energy and other production costs, or
unexpected costs that cannot be recouped in product pricing;
unexpected claims, charges, litigation, dispute resolutions or
settlement expenses; catastrophic events, including the impact of
weather events on the Company’s business; the discouragement of
lawsuits by shareholders against the Company and its directors and
officers as a result of the exclusive forum selection of the Court
of Chancery, the federal district court for the District of
Delaware or other Delaware state courts by the Company as the sole
and exclusive forum for such lawsuits; impacts of the Company’s
adoption of a limited duration shareholder rights plan including
potential deterrence of unsolicited offers to acquire the Company;
and the impact of the COVID-19 pandemic on the Company’s business,
including on the demand for its and our customers’ products and
services, on trade and transport restrictions and generally on our
ability to effectively manage the impacts of the COVID-19 pandemic
on our business operations. The foregoing list of factors is not
exhaustive. Investors and shareholders should carefully consider
the foregoing factors and the other risks and uncertainties
described in the Company’s Annual Reports on Form 10-K, Quarterly
Reports on Form 10-Q, and Current Reports on Form 8-K filed with
the U.S. Securities and Exchange Commission. The Company does not
assume any obligation to update or revise any forward-looking
statements.
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version on businesswire.com: https://www.businesswire.com/news/home/20210111005892/en/
Tim Perrott Investor Relations 561-438-4629
Timothy.Perrott@officedepot.com
Danny Jovic Media Relations 561-438-1594
Danny.Jovic@officedepot.com
Jeremy Fielding / Ruth Pachman Kekst CNC
Jeremy.fielding@kekstcnc.com / ruth.pachman@kekstcnc.com
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