Home Office Depot Parent Sheds CompuCom Amid Focus on Smaller Businesses
January 3, 2022
Office Depot Parent Sheds CompuCom Amid Focus on Smaller Businesses

By Mike Duff

Contributing Editor

The ODP Corp., which operates Office Depot and OfficeMax stores, announced the company has sold its CompuCom Systems subsidiary to an affiliate of Variant Equity in a transaction valued up to $305 million. The move is part of an overall plan by ODP to sharpen its focus on small and mid-sized and enterprise businesses.

The transaction value of up to $305 million consists of cash, an interest-bearing promissory note and a contingent future earn out. The ODP board of directors continues to evaluate its future capital allocation plans and use of proceeds but already has authorized a $200 million increase to its existing $450 million stock repurchase plan to $650 million.

“This action represents an important step in continuing to align our business model and resources towards our core strategy,” said Anthony Scaglione, ODP chief financial officer, in announcing the sale. “By enhancing our core focus and leveraging our B2B assets and digital commerce platform, we are in an excellent position to maximize returns for our shareholders.”

Farhaad Wadia, Variant Equity managing partner, added, “CompuCom has a long history of providing excellent technology support and services for its large blue-chip customer base. We are thrilled by this opportunity to partner with the CompuCom team and build on the company’s rich history of innovation.”

In August, ODP debuted plans to spin off the Office Depot and OfficeMax businesses and separate the company into two independent entities. Once the plans are executed, the retail operation will constitute one entity using the name Office Depot. The other will include the company’s Business Solutions Division, which it will rename ODP Business Solutions, and the newly formed B2B digital platform technology operation, which it will name Varis. ODP will own ODP Business Solutions and Varis but operate them as separate businesses. ODP also will continue ownership of its global sourcing operations and related operations as well as supply chain and logistics assets.

 

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