The ODP Corporation (NASDAQ: ODP), a leading provider of
business services, products and digital workplace technology
solutions through an integrated B2B distribution platform with an
online presence and approximately 1,100 stores (“ODP” or the
“Company”), announced today that it has entered into accelerated
share repurchase plan (“ASR”) agreements with Goldman Sachs &
Co. LLC and JPMorgan Chase Bank, National Association to repurchase
an aggregate of $150 million of the Company’s stock. ODP will
execute the ASRs under its existing stock repurchase program. When
combined with the Company’s previously completed share repurchases,
ODP will have committed to return more than $300 million of capital
to shareholders in 2021.
Under the ASR agreements, the Company will make an initial
payment of $150 million to the counterparties and will receive an
initial delivery of approximately 2.8 million shares of the
Company’s common stock by November 18, 2021. The total number of
shares ultimately repurchased under the ASR agreements will
generally be based on the average of the daily volume-weighted
average share prices of the Company’s common stock during the
calculation period of the accelerated share repurchase program,
less a discount, and subject to adjustments pursuant to the terms
of the ASRs. The final settlement of the ASRs is expected to be
completed in the first or second quarter of 2022.
“Today’s announcement reflects the confidence the Board of
Directors has in our business solutions provider and platform
transformation strategy and our capability to deliver shareholder
value through disciplined capital allocation,” said Gerry Smith,
chief executive officer of The ODP Corporation.
Additionally, as part of its ongoing commitment to drive
shareholder value in support of its strategic initiatives, the
Company announced today that its Board of Directors authorized a
$150 million increase in the existing $300 million stock repurchase
program to $450 million. Accordingly, the Company will have
approximately $142 million available for additional share
repurchases through June 30, 2022 following entering into the $150
million ASR. The authorization permits the Company to repurchase
common stock from time-to-time through a combination of open market
repurchases, privately negotiated transactions, 10b5-1 trading
plans, accelerated stock repurchase transactions and/or other
derivative transactions. The stock repurchase program may be
modified, extended, suspended or discontinued at any time. The
exact number and timing of share repurchases will depend on market
conditions and other factors, and will be funded through available
cash balances.
“The ODP Corporation’s free cash flow generation and strong
balance sheet provide us with the flexibility to invest in key
strategic initiatives as well as return capital to shareholders,”
said Anthony Scaglione, chief financial officer of The ODP
Corporation. “Our Board of Directors will continue to evaluate our
capital allocation plans in order to maximize long-term value for
shareholders.”
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 1,100 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.
ODP 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. ©2021 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 pandemic, 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 adverse effects of an unsolicited tender offer on our
business, operating results or financial condition; 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 will not be
able to achieve its strategic plans, including the proposed
separation of its consumer business and the planned sale of
CompuCom, and the high costs in connection with these transactions
may not be recouped if these transactions are not consummated; 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 the Maximize B2B Restructuring Plan
successfully or that such 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 and lost revenue;
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; 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; 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/20211116006398/en/
Tim Perrott
Investor Relations
561-438-4629 Tim.Perrott@officedepot.com
Danny Jovic
Media Relations
561-438-1594 Danny.Jovic@officedepot.com
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