Dive Brief:

• ODP Corp., parent company of Office Depot and OfficeMax, agreed in late December to sell its CompuCom Systems IT unit to private equity firm Variant Equity.
• The deal, which includes a mix of cash and an interest-bearing note among other terms, is valued at $305 million, according to a press release.
• The CompuCom unit's sales suffered during the pandemic, and CompuCom has been under review by its parent for more than a year. 

Dive Insight:

Office Depot originally acquired CompuCom for about $1 billion in 2017, more than three times the deal price for CompuCom to Variant.

At the time, the company said the acquisition marked the "first step" in a strategic transformation "from a traditional office products retailer to a broader business services and technology products platform."

"Technology is the office supply of the future," company CEO Gerry Smith said at the time of the announcement. "Today marks a significant milestone as we move to provide a unique business services platform for our current and future customers." 

Taking on a tech services company gave Office Depot broader reach as traditional, physical office supplies waned with the digitization of business. But the disruption to offices and office work caused by the pandemic weighed on CompuCom's revenue. Under strategic review, the company has effectively been on the sale block for more than a year.

Over the course of 2021, ODP has worked toward a large-scale reorganization, with the announcement of plans to split itself into two companies, one housing its business-to-business supply services and the other comprised of its retail banners.

Now, after trying to transform into a broad, diverse B2B services company ODP is moving to prune, narrow and divest.

"This action represents an important step in continuing to align our business model and resources towards our core strategy," said ODP Chief Financial Officer Anthony Scaglione in the press release announcing the CompuCom sale. "By enhancing our core focus and leveraging our B2B assets and digital commerce platform, we are in an excellent position to maximize returns for our shareholders."

As ODP readies itself for a split, it is still, as far as anyone can tell, being pursued by rival Staples. In November, Staples issued a press release reiterating its interest in buying ODP's retail business for $1 billion. 

ODP, meanwhile, has stuck to its plan to split. The company last said it expects to complete the spin-off process in the first half of this year.