ODP Corp., parent of the retailers Office Depot and OfficeMax and a long-time fixture of Palm Beach County’s corporate community, has agreed to be sold to a private equity firm in an all-cash deal valued at nearly $1 billion, the companies announced Monday.
The buyer is an affiliate of Atlas Holdings of Greenwich, Conn., which owns an array of 29 manufacturing and distribution businesses worldwide.
Stockholders of the Boca Raton-based company would receive $28 a share from the transaction, which is expected to close toward the end of this year. Once complete, ODP would become a private company and its common stock would no longer be traded on the NASDAQ exchange. The companies said the purchase price represents a 34% premium against last Friday’s closing stock price.
After the announcement, ODP shares surged to more than $33 by midday Monday.
“This transaction, fully supported by our Board, provides a substantial premium for The ODP Corporation’s shareholders and will improve the company’s position for the next phase of growth,” Gerry P. Smith, ODP’s chief executive officer, said in the statement. “Atlas brings an understanding of our industry, along with the operational expertise, resources and track record of supporting its companies that will fast forward our B2B growth initiatives and strengthen our position as a trusted partner to our customers.”
Atlas is buying a company divided into three parts: Office Depot LLC, which oversees the well-known Office Depot and OfficeMax retail operators; ODP Business Solutions LLC, which provides client businesses with products and services, and Veyer LLC, a supply chain company.
“Atlas has a long history of transitioning public companies into successful private enterprises and we are uniquely positioned to do just that with The ODP Corporation — an iconic American company,” said Atlas Managing Partner Michael Sher. “Atlas operates like a diversified holding company, and we have a proven record of delivering the human and financial capital necessary to create long-term value in our businesses.”
Sher said ODP’s management “has already taken several steps to mitigate the challenging retail environment, and we are the right partners to support The ODP Corporation’s continued evolution in its next chapter.”
ODP’s board unanimously approved the transaction, which is subject to regulatory and shareholder approvals.
A winding road
Founded as Office Depot in 1986, the company got its start with management operating out of a small strip mall headquarters in Boca Raton. The company moved its central operations to a sprawling site in Delray Beach on Old Germantown Road and South Congress Avenue, returning to Boca Raton in 2008 to a 28-acre campus at 6600 N. Military Trail. The new facilities were built to accommodate 2,500 employees.
For years, Office Depot engaged in a variety of takeover episodes and restructuring maneuvers, including cost cutbacks to stay profitable and competitive.
In 2013, Office Depot acquired OfficeMax, which was based in Illinois.
Rival Staples was a persistent but unsuccessful suitor. In 2015, a proposed buyout deal was blocked by the Federal Trade Commission. Several years later, another bid was rejected by Office Depot.
In 2020, Office Depot management announced a long-term plan to eliminate more than 13,000 jobs and close stores in a years-long quest to transform the focus of its business from office-products supplier to a seller of business services and supplies.
In 2022, the name Office Depot was supplanted by ODP Corp. as the parent company. It oversaw three divisions consisting of retail, business solutions and an information technology service called CompuCom, which had been acquired in 2017 but later sold in 2022 for $305 million.
Two years ago, the Boca Raton campus was sold for nearly $104 million.
Earlier this year, Boca Raton city officials approved a plan to redevelop the headquarters campus with apartments and spaces for a fitness center, retail outlets and restaurants.
This article has been updated to the company clarify where the company was located in its many years in Boca Raton and Delray Beach.
