Hedge fund seeks 4 spots on Office Depot board

Hedge fun Starboard Value looking to get 4 directors elected to Office Depot's board

Associated Press

NEW YORK (AP) -- Office Depot's biggest stockholder is looking to get four directors elected to the office supply company's board.

Hedge fund Starboard Value LP said Wednesday that it was forgoing a consent solicitation so that it could seek the election of Cynthia T. Jamison, Robert L. Nardelli, Jeffrey C. Smith and Joseph S. Vassalluzzo.

Smith is the CEO of Starboard, while Nardelli is the former CEO of Home Depot Inc. and Chrysler LLC. Jamison is a Tractor Supply Co. board member and the lead director. Vassalluzzo is non-executive chairman at Federal Realty Investment Trust and lead director at Life Time Fitness. He is the former vice chairman of Staples Inc.

A consent solicitation would have allowed Starboard in the absence of an annual meeting by Office Depot to seek shareholder consent to replace up to four of the board members with its candidates.

The news comes as the Delaware Chancery Court ruled that Office Depot must hold its annual meeting on Aug. 21, a date the company previously established. Starboard had filed a suit earlier this month to force the company to hold the meeting.

Office Depot Chairman and CEO Neil Austrian said in a statement on Tuesday that Starboard knew the company had started the annual meeting process before it filed its complaint.

"It was unfortunate the company had to spend time and resources on this distracting litigation," he said.

Office Depot Inc., which is based in Boca Raton, Fla., is incorporated in Delaware. A regulatory filing said that Office Depot last held a shareholder meeting on April 29, 2012.

Starboard — which holds a 14.8 percent stake in Office Depot — said that the court order means that Office Depot can't postpone or delay the annual meeting further.

For the Aug. 21 meeting, Office Depot shareholders of record on July 11 will be eligible to vote.

Office Depot reached a deal in February to combine with Naperville, Ill. based-OfficeMax in an all-stock transaction worth about $1.2 billion, but key details, such as the name of the new company, CEO and headquarters, have yet to be determined.

Starboard continues to favor the merger, but maintains a new board is needed to help improved the company's operating performance and to have the most highly qualified board members in place for the combined company's board.

Office Depot's stock added 4 cents to $3.95 in light afternoon trading. The stock has traded between $1.51 and $6.10 in the past 52 weeks.

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