- This topic has 0 replies, 1 voice, and was last updated 9 years, 9 months ago by
.
-
Posts
-
OfficeMax Restructures and Shuts 110 Stores
ITASCA,
Ill. – OfficeMax Inc., the nation’s No. 3 office supplies retailer,
said Tuesday it will shut down 110 of its approximately 950 U.S. retail
stores in the first quarter as part of a restructuring aimed at
strengthening its business.
The company also said it will close its
wood-polymer building materials plant in Elma, Wash., and make other
moves as part of a shake-up that will result in $187 million in pretax
charges.
OfficeMax did not disclose the locations of the stores
targeted for closure by the end of March or how many jobs would be
affected. The company will be notifying the stores involved over the
next week, spokesman Bill Bonner said.
In a regulatory filing, it
indicated that all the stores to be closed are superstores, which
comprise the vast majority of its stores. It also plans to close five
retail stores in Canada.
OfficeMax still intends to open 70 new stores this year and expects to have 887 domestic retail stores at the end of this year.
The
company has been struggling to keep up with bigger competitors Staples
Inc. and Office Depot Inc. and also has suffered from internal
problems. Its largest shareholder, K Capital Partners LLC, demanded in
November that the board of directors take immediate steps to improve
its “dismal” financial and operating performance.
Sam Duncan,
chairman and chief executive officer since last year, called the
closings “a difficult but necessary step toward improving our company’s
overall performance.” He said it resulted from an assessment last year
of each store’s results and growth potential.
The company said it
plans to record pretax costs of about $141 million for the domestic
store closings, roughly $41 million for exiting the building materials
business, and about $5 million for restructuring its overseas
operations.
About $141 million of the total charges will be incurred
in this year’s first quarter, while the balance was recorded in last
year’s fourth quarter, OfficeMax said.
OfficeMax began introducing a
new store format recently that signals a shift away from the
warehouse-style stores that are the industry standard, including
boutique-like shopping areas, soft lighting and a cafe.
- You must be logged in to reply to this topic.