* Largest shareholder Starboard owns 14.8 pct of Office
* Starboard says not selling stake will be
Feb 27 Office Depot Inc's largest
shareholder, Starboard Value LP, urged the office supply chain's
board to explore the sale of its Mexican joint venture interest
Starboard, which owns a 14.8 percent stake in the company,
said in a letter to the board it believes the value of Office
Depot's 50 percent joint venture interest in the Office Depot de
Mexico business is not fully reflected in the retailer's stock
Mexican retailer Grupo Gigante, which owns the
other half of the venture, said on Feb. 21 it offered 8.78
billion pesos ($687.34 million) to buy the stake that it does
not already own, and that the offer would expire soon.
Grupo Gigante earlier bid for the stake in 2008, but was
turned down by the office supply chain.
Starboard said given that Grupo's offer expires on Feb. 28,
Office Depot should promptly obtain consent from OfficeMax under
its merger deal to immediately explore a sale of the interest.
"If OfficeMax does not consent to Office Depot's
negotiations with Gigante or any other potential buyer regarding
the sale of the JV Interest, Starboard would view this as both
unreasonable and potentially anti-competitive," the shareholder
said in the letter.
Office Depot said last week it would merge with smaller
rival OfficeMax Inc in a $976 million all-stock deal.
Shares of Office Depot were up 2 percent in premarket
trading on Wednesday. They closed at $3.99 on the New York Stock
Exchange on Tuesday.