Office Depot, OfficeMax Narrow CEO Search To Five Candidates

(RTTNews) - Office products retailer Officer Depot Inc. (ODP) and peer OfficeMax Inc. (OMX), which agreed to merge in February, said that the selection process for a chief executive officer to lead the combined company has now narrowed to five candidates. The companies continue to expect to have a permanent CEO in place by September.

However, the companies warned that a proxy campaign being led by Starboard Value LP, an investor in Office Depot's stock, could prove counterproductive to the CEO selection process.

In February, Office Depot agreed to buy OfficeMax in an all-stock deal valued at about $1.2 billion. The merger will create an 18 billion global office solutions company in order to fight competition from market leader Staples, Inc. (SPLS) and Amazon.com, Inc. (AMZN).

At that time, the boards of directors of both companies decided to undertake a comprehensive search process that would consider both internal and external candidates to identify a CEO to lead the combined company.

The two companies noted that the CEO Selection Committee has reviewed and vetted more than 100 candidates, while eight of the top candidates have already been interviewed. The selection process has now been narrowed to "five exceptional candidates".

In June, OfficeDepot and OfficeMax hired executive search firm Korn/Ferry International to assist the CEO Selection Committee in its comprehensive search. The Committee is co-chaired by OfficeMax Board Member Jim Marino, the former President and CEO of Alberto Culver Co., and Office Depot Board Member Nigel Travis, the chairman and CEO of Dunkin' Brands, Inc. (DNKN).

Nigel Travis said, "We are very concerned that the disruptive proxy campaign currently being led by Starboard to replace four Office Depot Board members, including two that currently sit on the CEO Selection Committee, if successful, will prove counterproductive to the CEO selection process."

Travis added, "Based on our discussions with Office Depot shareholders, we believe the shareholders do not want to disrupt the CEO search process or in any way impact the value that is attainable from the OfficeMax merger, which this Board is intensely focused on delivering."

Starboard, the largest common shareholder of Office Depot, said in June that it will seek the election of four of its candidates at Office Depot's annual meeting of shareholders to be held on August 21.

In Monday's regular trading session, ODP is trading at $4.22, down $0.01 or 0.18 percent on a volume of 78,907 shares. OMX is trading at $11.02, up $0.03 or 0.27 percent on a volume of 34,810 shares.