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The business landscape is continually evolving, and a significant development in the office supply and business solutions sector has seen The ODP Corporation, parent company of Office Depot, agree to a major acquisition. This move will see the publicly traded entity transition into a privately held company, marking a new chapter in its corporate history. The deal, which values The ODP Corporation at approximately $1 billion, underscores a strategic shift aimed at fostering future growth and adapting to dynamic market conditions.
On Monday, September 22nd, The ODP Corporation announced its agreement to be acquired by an affiliate of Atlas Holdings. Atlas Holdings is renowned as an owner and operator of 29 diverse manufacturing and distribution businesses, bringing a wealth of experience in managing industrial and commercial enterprises. This all-cash transaction is anticipated to conclude by the end of the current year, subject to the customary closing conditions inherent in such large-scale corporate acquisitions. Once finalized, The ODP Corporation will shed its public status, becoming a private entity under the stewardship of Atlas Holdings.
Strategic Vision for Future Growth
Gerry P. Smith, the Chief Executive Officer of The ODP Corporation, articulated the strategic rationale behind this acquisition. Smith expressed confidence that the transaction would significantly enhance the company's position, preparing it for its subsequent phase of expansion and development. He highlighted Atlas's deep understanding of the industry, coupled with its proven operational expertise, substantial resources, and a commendable track record of supporting its portfolio companies. This partnership is expected to accelerate ODP’s Business-to-Business (B2B) growth initiatives and solidify its standing as a reliable partner for its diverse customer base.
The sentiment was echoed by Michael Sher, a Managing Partner at Atlas Holdings. Sher emphasized Atlas's established proficiency in successfully transitioning public companies into thriving private enterprises. He noted their commitment to providing both the human and financial capital essential for cultivating long-term value. According to Sher, The ODP Corporation’s leadership has already proactively taken measures to navigate the challenging retail environment. He stated that Atlas is uniquely positioned as the ideal partner to support ODP's ongoing evolution as it embarks on this new corporate journey.
Navigating Financial Headwinds
The acquisition comes at a time when The ODP Corporation has been grappling with certain financial challenges. In its earnings release on August 6th, the company reported that its second-quarter sales for 2025 totaled $1.6 billion, representing an 8% decline compared to the same period in the previous year. This downturn was primarily attributed to several factors within its Office Depot Division, including operating with 60 fewer retail stores than in the prior year. Additionally, the division experienced a decrease in both retail and online consumer traffic, impacting overall sales performance. The ODP Business Solutions Division also recorded lower sales during this period, contributing to the overall revenue reduction.
Despite these headwinds, Gerry P. Smith noted some areas of improvement within the company's segments. In the consumer segment, the company observed a meaningful improvement in same-store sales trends year-over-year, which Smith attributed to the effectiveness of their targeted sales strategies and a strong value proposition. Furthermore, in the B2B distribution business, The ODP Corporation achieved approximately a 200-basis point improvement in year-over-year revenue trends. This positive shift was driven by robust sales traction with new customers and nascent contributions from its strategic expansion into the hospitality sector. These efforts suggest an underlying resilience and a proactive approach to addressing market shifts, even as broader sales figures showed contraction.
A History of Strategic Considerations
This isn't the first time The ODP Corporation has been at the center of acquisition discussions. In June 2022, the company's board of directors notably rejected several "public and private non-binding proposals" related to the potential sale or spin-off of its consumer brands. At that time, the board maintained that its retail and B2B office supply businesses were strategically better off together. The current decision to agree to an acquisition by Atlas Holdings signifies a potential reevaluation of this strategy, indicating a belief that private ownership, combined with Atlas's specialized expertise, offers a more advantageous path forward for the entire corporation.
The transition to a private company is often undertaken to allow for greater flexibility in strategic decision-making, shield the company from short-term market pressures, and facilitate long-term investment without the immediate scrutiny of public shareholders. For The ODP Corporation, this could mean a more focused approach to its B2B initiatives, deeper investments in technology solutions, and potentially restructuring its retail footprint without constant public reporting demands. Atlas Holdings' experience in operating and optimizing manufacturing and distribution businesses suggests that they will bring a hands-on approach to enhance operational efficiencies and unlock new avenues for growth that might be more challenging to pursue as a public entity.
In conclusion, the acquisition of The ODP Corporation by Atlas Holdings marks a pivotal moment for the office supply giant. Valued at $1 billion, this deal aims to transform ODP into a private company, leveraging Atlas’s operational prowess and capital to navigate a competitive market and accelerate its B2B growth. As the transaction moves towards completion, all eyes will be on how this new partnership reshapes the future trajectory of Office Depot and its broader business solutions offerings.
