Glass Lewis & Co. Affirms The Need For Change On Office Depot Board In Recommending Office Depot Shareholders Vote The GOLD Proxy Card To Elect Starboard Nominees At Upcoming Annual Meeting
Glass Lewis Concludes that "Shareholders Should Seek Additional Board-Level Changes at This Time to Ensure the Best-Qualified and Most Effective Individuals Are In Place to Improve Office Depot's Stand-Alone Performance and to Maximize the Synergies and Chances of Success Once the Merger Becomes Effective"
NEW YORK, Aug. 12, 2013 /PRNewswire/ -- Starboard Value LP (together with its affiliates, "Starboard"), the largest shareholder of Office Depot, Inc. ("Office Depot" or the "Company") (NYSE: ODP) with approximately 14.6% of the outstanding common stock of the Company, announced today that Glass Lewis & Co., LLC, a leading independent proxy voting advisory firm, has recommended that Office Depot shareholders vote on Starboard's GOLDproxy card to elect three of Starboard's highly qualified nominees, Cynthia Jamison, Jeffrey Smith and Joseph S. Vassalluzzo at Office Depot's upcoming Annual Meeting on August 21, 2013. Glass Lewis' show of support marks the second such strong recommendation for a vote on Starboard's GOLD proxy card from an independent proxy voting advisory firm in the past week. Last week, Institutional Shareholder Services (ISS) recommended that Office Depot shareholders vote on Starboard's GOLDproxy card to elect three of Starboard's highly qualified nominees after concluding that Starboard made "a compelling case that a change at the board level is warranted." Starboard urges all Office Depot shareholders to support Glass Lewis' and ISS' calls for change on the Office Depot Board by voting the GOLD proxy card TODAY to elect all four of Starboard's highly qualified nominees, Cynthia Jamison, Robert Nardelli, Jeffrey Smith and Joseph S. Vassalluzzo at the Annual Meeting. In reaching its conclusion, Glass Lewis, like ISS, performed a detailed analysis of both sides' positions in the election contest and, in particular, carefully considered, among other things, the Company's poor total shareholder return and operating performance, troubling 2010 CEO search process, unresponsiveness to governance concerns, as well as the strong experience and qualifications of Starboard's nominees. Glass Lewis concluded that shareholders should vote on the Gold proxy card saying: "This proxy contest takes place at a unique and critical time -- after shareholders have approved a merger, but before the merger has closed or the combined company's board has been constituted. As a result, shareholders have an opportunity to help decide who should lead the combined company and represent their interests at the board level.""In this case, we believe the Dissident has identified areas of concern, related to both performance and governance, which have resulted in the destruction of shareholder value and, at times, the disregard of shareholder interests. In our view, Starboard has put forth a compelling case which details the poor performance of the Company under the stewardship of the current board, the board's questionable actions and unresponsiveness to shareholder concern, and the overall need for a change in leadership. Further, we believe the Dissident's nominees possess the requisite skills and qualifications needed for Office Depot's current situation. In our opinion, the addition of new directors at this time would likely increase the chances that the best leadership team is installed at Office Depot, as either a merged or stand-alone company, as it attempts to execute a successful turnaround."Excerpts from Glass Lewis' Analysis & RecommendationOn Concluding that Change is Warranted on the Office Depot Board: "In light of the Company's underperformance versus peers under the current board's guidance and the board's lack of an adequate response to shareholder concern, along with other concerns noted above, we see merit in the Dissident's assertion that the board is in need of improvement. Having reviewed the arguments and responses put forth by Starboard and the current board, we believe shareholders should seek additional board-level changes at this time to ensure the best-qualified and most effective individuals are in place to improve Office Depot's stand-alone performance and to maximize the synergies and chances of success once the merger becomes effective."