Office Depot Mexico Sale Talks Said to Extend Beyond DeadlineJonathan Levin
Office Depot Inc., the second-largest office-supply chain, is extending talks to sell its Mexico unit to Grupo Gigante SAB beyond the March 15 deadline, said a person with direct knowledge of the deal.
The talks were prolonged in part because Office Depot is already involved in the purchase of OfficeMax Inc. for $1.17 billion, said the person, who asked not be named because the conversations are private.
Office Depot spokesman Brian Levine and Jorge Hernandez Talamantes, an investor relations official with Gigante, didn’t respond to telephone messages and e-mails sent outside of normal business hours yesterday seeking comment on the talks.
Office Depot and OfficeMax announced their transaction on Feb. 20, one day before Gigante made public its offer to buy the 50 percent of Office Depot de Mexico it doesn’t already own for 8.78 billion pesos ($706 million). Gigante said in a Feb. 28 filing with the Mexican stock exchange that its offer expired March 15.
Starboard Value LP, the activist investor that has pressured Office Depot to improve operations, told the chain in a letter it should sell the Mexico unit.
“A sale of this asset at a full and fair price is clearly in the best interest of both Office Depot and OfficeMax shareholders,” Starboard said in the letter to Office Depot made public Feb. 27 in a statement.
Office Depot de Mexico includes operations in Colombia and Central America.
Office Depot entered the joint venture with Grupo Gigante in 1994, and the business has since expanded to more than 200 stores, according to regulatory filings.