Office Depot CEO to Step Down

Office Depot Inc. said Monday that Chief Executive Roland Smith would retire next year, just months after a federal judge blocked a planned merger with rival Staples Inc.

The move means the two leaders in the office-supply space are both looking for new CEOs in light of the failed tie-up. Staples Chief Executive Ron Sargent stepped down as CEO in June and the company has yet to name a successor.

A judge ultimately scuttled the transaction, siding with the Federal Trade Commission. The FTC had argued that the combination would lead to higher prices for large corporations that buy office supplies in bulk.

The decision marked the second time U.S. antitrust watchdogs have scuttled a Staples-Office Depot combination. The two brands were also blocked from merging in 1997.

Mr. Smith will continue to be CEO until a successor is named, which is expected by the end of first quarter of 2017, and will remain chairman. He joined Office Depot in November 2013, just as the company was buying rival OfficeMax Inc.

"My decision to retire has not been an easy one," Mr. Smith said. "In 2013, I set aside a number of personal ambitions to accept a three-year contract with Office Depot, and it's now time for me to refocus on those priorities."

Office Depot said earlier this month that it would launch a quarterly dividend and close an additional 300 stores as works to cut costs. In its latest quarter, the company swung to a profit, helped in large part by the deal's $250 million breakup fee it received from Staples, but that its revenue was lower.

Office Depot on Monday also announced a number of changes and new positions at lower executive levels.

Write to Austen Hufford at [e-mail]

(END) Dow Jones Newswires

August 22, 2016 09:15 ET (13:15 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.