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Investor wants Office Depot to mull JV stake sale

NEW YORK (AP) -- Office Depot Inc.'s largest shareholder said Wednesday that it wants the office supply company to consider selling its stake in a Mexican joint venture, saying such a deal could benefit stockholders.

Investment firm Starboard Value LP thinks that Office Depot's 50 percent interest in Office Depot de Mexico isn't fully reflected in the stock price.

Starboard owns about 15 percent of Office Depot.

Office Depot's partner in the venture, Grupo Gigante SAB de CV, has offered to buy Office Depot's stake for $690.5 million, Starboard said. The offer expires on Thursday, so Starboard wants Office Depot to get permission from OfficeMax Inc. to immediately explore a possible sale.

Boca Raton, Fla.-based Office Depot and Naperville, Ill.-based OfficeMax announced an agreement last week to combine in an all-stock deal worth about $1.2 billion.

Selling the Mexico interest would be in the best interest of both companies if they combine, as well as for Office Depot as a standalone company, Starboard said. But the firm noted that OfficeMax may have mixed feelings about the sale, given that it would strengthen a competitor if the two companies didn't end up combining.

Office Depot officials didn't immediately return an email seeking comment Wednesday.

Shares rose 5 cents to $4.04 just before the opening bell. OfficeMax stock was unchanged.