UPDATE 1-Office Depot shareholder to nominate directors

Mon Mar 17, 2008 4:12pm EDT

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ATLANTA, March 17 (Reuters) - An Office Depot Inc ODP.N shareholder said on Monday it planned to nominate former executives of the company and rival Staples Inc (SPLS.O) to serve on the board in place of two Office Depot candidates, including the company's chief executive.

Woodbridge Group, which includes Woodbridge Equity Fund and real estate developer Levitt Corp LEV.N, intends to nominate Mark Begelman, former president of Office Depot, and Martin Hanaka, the former president of Staples, for election to the board at Office Depot's annual meeting on April 23.

In a statement, Woodbridge Group said Office Depot "needs new representation" on the board to revitalize the retailer, which it added had lost vision and its competitive position.

Office Depot results have suffered as slowing job growth, the U.S. housing crisis and credit market jitters led small businesses to cut spending.

The retailer reported a bigger-than-expected drop in fourth quarter profit late last month and CEO Steve Odland said on a conference call it would be difficult to rejuvenate growth unless markets improve.

What is more, a regulatory filing disclosed in February that the U.S. Securities and Exchange Commission was investigating Office Depot for allegedly making a series of phone calls to analysts last June, warning them that weak economic conditions were hurting sales. Office Depot also announced last month that its chief financial officer resigned.

Woodbridge Group said it was nominating Begelman, 60, and Hanaka, 58, to serve on Office Depot's board in place of company director candidates David Fuente and Odland.

Woodbridge said its nominees were committed to "taking immediate and aggressive action to turn around Office Depot's business and redefine its position in the marketplace."

Office Depot shares were down 8 cents at $10.96 in afternoon trading on the New York Stock Exchange. The shares have fallen 68 percent in the past year. (Reporting by Karen Jacobs; Editing by Andre Grenon)