An OfficeMax Inc. shareholder sued to block a proposed $1.17 billion takeover by Office Depot Inc., calling the deal "grossly inadequate."
The acquisition, announced by the companies on Feb. 20, would combine the second- and third-biggest U.S. office-supply businesses behind market leader Staples Inc. Stockholders of Naperville-based OfficeMax would get 2.69 shares in Office Depot for each one of their shares.
"OfficeMax, if properly exposed to the market for corporate control, would bring a price materially in excess of the amount offered in the proposed transaction," the OfficeMax shareholder, Eric Hollander, said in a complaint filed yesterday in federal court in Chicago.
Hollander is seeking to proceed on behalf of all OfficeMax shareholders affected by the merger plan. He's seeking an order blocking the deal unless OfficeMax gets an agreement "providing the best available terms for shareholders."
Also named as defendants are OfficeMax Chairman Rakesh Gangwal, Chief Executive Officer Ravichandra K. Saligram, six other board members and Boca Raton, Florida-based Office Depot.
Hollander accused the individual defendants of breaching their fiduciary duty to OfficeMax stockholders and Office Depot of aiding and abetting that breach. He is seeking a court order compelling the individual defendants to account for all damages sustained by the investor class.
Nicole Miller, a spokeswoman for OfficeMax, had no immediate comment on the lawsuit yesterday. Brian Levine, a spokesman for Office Depot, declined to comment on it.
The case is Hollander v. OfficeMax Inc., 13-cv-03330, U.S. District Court, Northern District of Illinois (Chicago).