Office Depot, Inc. (NYSE: ODP), a leading global provider of office supplies and services, today sent a letter to all shareholders urging them to vote the white proxy card in favor of Office Depot’s ten director nominees and their ongoing efforts to successfully close the OfficeMax transaction and unlock significant value for all shareholders.
In the letter, Office Depot also highlights why it believes activist investor Starboard Value LP (Starboard) and its nominees could significantly disrupt not only the progress and momentum made on the OfficeMax transaction (as integration planning and a CEO search are already well underway), but also the realization of substantial synergies from the planned merger.
Starboard’s purported plan for the Company, which they unveiled just a few weeks ahead of the annual meeting, also threatens Office Depot’s core operational improvements by pushing the Company to make outsized cuts in critical business functions.
A copy of the letter follows:August 7, 2013 Dear Fellow Shareholder: Our annual meeting of shareholders on August 21, 2013 is now just two weeks away and we are writing to you today to underscore that your vote at this meeting will determine the future value of your investment in Office Depot. We are urging all shareholders to vote the WHITE proxy card today in support of our nominees for Office Depot’s Board of Directors, who are best positioned to guide the Company through its value-creation opportunities. Over the course of the last week, your vote FOR our nominees has become even more critical. Vote on the WHITE Proxy Card to Ensure that Your Company Remains on Course to Unlock Significant Value We urge you to disregard any proxy materials from Starboard Value, LP, an activist investor in the Company’s stock which is threatening to throw the Company’s recent progress off track. Your Board strongly believes that at this time the insertion of Starboard’s nominees into the preparation process around the Company’s planned merger with OfficeMax would imperil the continued, successful implementation of our strategic plan and integration. Our ongoing integration work is critical to delivering the significant value inherent in our merger and is being led by joint teams from both Office Depot and OfficeMax with the added guidance of The Boston Consulting Group (BCG). BCG has advised that each month of delay in the integration process will result in the loss of $12M in synergy savings for shareholders. Moreover, any synergies unrealized in the first 18 months are unlikely to be realized at all. We urge you to let the Board and management continue to focus on creating value for you -- please vote on the WHITE proxy card today. Preparation for the Merger is Already Well Underway This is a critical moment in your Company's history, and one that is years in the making. The OfficeMax merger is a pivotal step in the strategic plan put in place by this Board in 2010, and it is a step we have been intensely focused on ever since.