DEFA14A: ODP Corp. to Go Private in $1B Atlas Holdings Deal

The ODP Corporation announced an agreement to be acquired by an affiliate of Atlas Holdings for $28 per share in cash, representing a 34% premium.

Summary

• The ODP Corporation has entered into a definitive agreement to be acquired by ACR Ocean Resources LLC, an affiliate of Atlas Holdings.
• Shareholders will receive $28 per share in cash for each share of ODP common stock.
• This purchase price represents a 34% premium to ODP's closing share price on September 19, 2025.
• The transaction values The ODP Corporation at approximately $1 billion.
• Upon completion, ODP will become a privately held company, and its common stock will no longer be listed on the NASDAQ stock exchange.
• The Board of Directors of The ODP Corporation unanimously approved the transaction.
• The transaction is expected to be completed by the end of 2025, subject to customary closing conditions, including regulatory and shareholder approvals.

Sentiment

Score: 8

Explanation: The filing announces an all-cash acquisition at a significant premium, unanimously approved by the board, which is generally very positive for shareholders. While there are standard merger-related risks, the immediate and substantial value offered outweighs these for current shareholders.

Positives

• Shareholders are offered a substantial cash premium of 34% over the September 19, 2025 closing share price.
• The all-cash nature of the transaction provides certainty and immediate liquidity for shareholders.
• The acquisition by Atlas Holdings is expected to improve ODP's position for future growth, particularly in B2B initiatives.
• Atlas Holdings brings industry understanding, operational expertise, and resources to support ODP's continued evolution.
• The transaction received unanimous approval from ODP's Board of Directors.

Negatives

• Shares will be delisted from NASDAQ, removing public trading opportunities for investors.
• The company will become privately held, which typically reduces transparency and public oversight.
• There is a risk of the Company's stock price fluctuating and potentially declining if the proposed transaction is not completed.
• The transaction may cause disruptions to ODP's business, current plans, and operations during its pendency.
• Management's time and attention may be diverted from ordinary course business operations to transaction completion and integration matters.

Risks

• The completion of the proposed transaction on the anticipated terms and timing is not guaranteed.
• Satisfaction of other conditions to the completion of the proposed transaction, including obtaining required shareholder and regulatory approvals, may not occur.
• The Company's stock price may fluctuate during the pendency of the proposed transaction and may decline if the proposed transaction is not completed.
• Potential litigation relating to the proposed transaction could be instituted against the Company or its directors, managers, or officers.
• Disruptions from the proposed transaction will harm the Company's business, including current plans and operations, during its pendency.
• The ability of the Company to retain and hire key personnel may be impacted.
• Diversion of management's time and attention from ordinary course business operations to completion of the proposed transaction and integration matters.
• Potential adverse reactions or changes to business relationships resulting from the announcement or completion of the proposed transaction.
• Legislative, regulatory, and economic developments could affect the transaction or the Company's financial performance.
• Potential business uncertainty, including changes to existing business relationships, during the pendency of the proposed transaction that could affect the Company's financial performance.
• Certain restrictions during the pendency of the proposed transaction may impact the Company's ability to pursue certain business opportunities or strategic transactions.
• Unpredictability and severity of catastrophic events, including acts of terrorism, outbreaks of war or hostilities, or global pandemics, as well as management's response to any of the aforementioned factors.
• The possibility that the proposed transaction may be more expensive to complete than anticipated, including as a result of unexpected factors or events.
• Unexpected costs, liabilities, or delays associated with the transaction.
• The response of competitors to the transaction.
• The occurrence of any event, change, or other circumstance that could give rise to the termination of the proposed transaction, including in circumstances requiring the Company to pay a termination fee.
• Other risks are set forth under the heading 'Risk Factors' in the Annual Report on Form 10-K for the year ended December 28, 2024, and in subsequent SEC filings.

Future Outlook

The ODP Corporation anticipates that the acquisition by Atlas Holdings will enhance its position for future growth, specifically by accelerating B2B growth initiatives and reinforcing its role as a trusted partner to customers. The transaction is projected to conclude by the end of 2025, contingent upon fulfilling customary closing conditions, including obtaining necessary regulatory and shareholder approvals.

Management Comments

• "This transaction, fully supported by our Board, provides a substantial premium for The ODP Corporation's shareholders and will improve the company's position for the next phase of growth." Gerry P. Smith, Chief Executive Officer of The ODP Corporation.
• "Atlas brings an understanding of our industry, along with the operational expertise, resources and track record of supporting its companies that will fast forward our B2B growth initiatives and strengthen our position as a trusted partner to our customers." Gerry P. Smith, Chief Executive Officer of The ODP Corporation.
• "Atlas has a long history of transitioning public companies into successful private enterprises and we are uniquely positioned to do just that with The ODP Corporation – an iconic American company." Michael Sher, Atlas Managing Partner.
• "The ODP Corporation's leadership has already taken several steps to mitigate the challenging retail environment, and we are the right partners to support The ODP Corporation's continued evolution in its next chapter." Michael Sher, Atlas Managing Partner.

Industry Context

The acquisition of The ODP Corporation by Atlas Holdings aligns with a broader industry trend where private equity firms acquire established public companies, particularly those navigating evolving market landscapes. Atlas Holdings, with its diversified portfolio and operational expertise, is positioned to support ODP's strategic pivot towards B2B solutions and mitigate pressures from the traditional retail sector, reflecting a common strategy to adapt to changing consumer behaviors and the growth of e-commerce.

Legal Proceedings

• Potential litigation relating to the proposed transaction could be instituted against the Company or its directors, managers, or officers.

Stakeholder Impact

• Shareholders: Will receive $28 per share in cash, representing a 34% premium, but will no longer hold shares in a publicly traded company.
• Employees (Associates): Atlas Holdings anticipates a positive outcome for ODP's associates, though the ability to retain and hire key personnel is identified as a risk during the transition.
• Customers: The acquisition is expected to strengthen ODP's position as a trusted partner, particularly through enhanced B2B growth initiatives.
• Suppliers: Atlas Holdings anticipates a positive outcome for ODP's suppliers.
• Management: Time and attention will be diverted from ordinary course business operations to transaction completion and integration matters.

Next Steps

• The ODP Corporation plans to file one or more proxy statements or other documents with the SEC in connection with the proposed acquisition.
• The proposed transaction requires approval by The ODP Corporation shareholders.
• The proposed transaction is subject to customary regulatory approvals.
• The transaction is expected to be completed by the end of 2025.

Key Dates

Recommendation

The announcement of an all-cash acquisition at a 34% premium to the recent closing price makes this a strong buy for investors seeking to capture the arbitrage spread. The unanimous board approval and expected completion by year-end 2025 suggest a high likelihood of the deal closing, offering a clear, immediate return for current shareholders. The primary risk is the deal not closing, but the premium offered makes the risk/reward favorable.

Keywords

ODP Corporation, Atlas Holdings, Merger, Acquisition, Office Depot, OfficeMax, B2B Solutions, Private Equity, Shareholder Value, Retail Environment, Supply Chain Management