Office Depot and OfficeMax officially merged after the stock market closed Tuesday, announcing that the new company will be called Office Depot.
No decision has been made on where the joined firm will be located. For the time being, according to a joint news release, the two will continue to operate from separate headquarters.
The CEO selection committee plans to choose a CEO for the company now that the merger has been approved by the Federal Trade Commission and finalized, the release states. In the meantime, Office Depot CEO Neil Austrian and OfficeMax CEO Ravi Saligram will continue to serve as joint CEOs.
“We are hopeful that the CEO Selection Committee will complete the process in the near future,” Office Depot spokesman Brian Levine said.
Initially, the committee had indicated it would choose a CEO by September.
Office Depot (NYSE: ODP, $5.65) and OfficeMax (NYSE: OMX, $15.26) each reported a profit for the third quarter, in separate filings after the close of the market, contrary to last quarter when each reported a loss. Both reported sales declines from the same quarter in 2012. The joint company is expected to have sales of nearly $18 billion a year, still less than industry leader Staples.
Office Depot sales were $2.6 billion in the quarter that ended Sept. 28, a 3 percent drop over the same quarter last year. Earnings were $160.9 million before paying preferred stockholders, or 41 cents per diluted share, according to financial filings. The sale of its Mexican joint venture brought in $381 million before taxes, but the merger and shareholder-related expenses cost the company $40 million.
Troy McLellan, president of CEO of the Greater Boca Raton Chamber of Commerce, said the big questions remain for interested business leaders in Palm Beach County.
“We’re going to remain encouraged that we will retain our beloved Office Depot,” he said.
After 25 years locating its company headquarters in south Palm Beach County, growing from one Fort Lauderdale store in 1986 to 1,112 throughout the world by the end of 2012, losing Office Depot would be a blow. It’s one of Palm Beach County’s two Fortune 500 companies.
Little is being said publicly about economic development leaders’ efforts to keep the company headquarters in Palm Beach County. Office Depot is in the middle of a 10-year tax refund deal that returned more than $600,000 to the company last year.
“We understand the significance of keeping an industry leader like Office Depot in our state, and are committed to retaining those Florida jobs following the merger with OfficeMax,” said Sean Helton, director of Strategic Communications for Enterprise Florida, which awards state incentives.
In Illinois this week, state Sen. Tom Cullerton is hoping to sweeten the pot during a three-day special session. OfficeMax already has a tax credit deal there, but has only applied for $2.4 million out of a possible $20 million over 10 years because it hasn’t made enough money to need credits.
Cullerton’s plan would allow OfficeMax to keep its share of employees’ income taxes if the company retained 2,000 corporate jobs in the state and invested $150 million in its headquarters.
“Much like Florida, everybody wants to have the best business climate they can,” Cullerton said this week. He vowed to keep working on incentives to keep such a valuable company, especially now that it has grown in the merger.