April 8th 2004

Back to main menu

OFFICE DEPOT ACQUIRES BUSINESS IN HUNGARY

• Former Licensee Becomes Wholly Owned Subsidiary

• Expansion into Eastern Europe Significant as New Countries Join the EU
   

Delray Beach, Fla. – April 8, 2004 – Office Depot, Inc. (NYSE: ODP) today announced that it has completed the acquisition of the business of Első Iroda Superstore Kft, which has been operating Office Depot retail stores and direct sales businesses in Hungary under license from Office Depot.  The acquisition will be Office Depot’s first expansion into Eastern Europe as a wholly owned business, rather than under licensed arrangements.

The company currently operates three retail stores, a distribution center and Internet sales facility in Hungary and will open a fourth retail store later this year.   Current plans call for additional retail expansion up to a total of 17 stores in Hungary by the end of 2006, as well as a new distribution center to serve that country and possibly adjacent countries as well.  Estimated revenues of the company, in U.S. dollars, for 2004 are $25 million.

The business in Hungary was acquired from its parent entity, Retail Holdings Hungary, Inc. of Miami and New York.  The business will be operated under the management of Office Depot Europe, headquartered in Venlo, the Netherlands.  Istvan Miholek, currently President of Első Iroda, will serve as country manager for Office Depot.  The purchase price is announced at $10 million, a portion of which is deferred.  Other  terms of the purchase were not disclosed. 

Rolf van Kaldekerken, President of Office Depot Europe, stated: 

“We are really pleased to add this impressive business in Eastern Europe as our initial expansion into that part of the continent on a wholly owned basis.  Istvan Miholek, who will be our country manager in Hungary, has built a strong management team, and we look forward to fully integrating this company into our European organization quickly.  As we look forward to the expansion of the EU in the coming months, we see tremendous opportunity for growth in Eastern Europe.”

Bruce Nelson, Chairman and CEO of Office Depot said,

 “This very strategic transaction represents further evidence of our commitment to being the leading office products supplier throughout Europe. We will continue to look for appropriate opportunities to grow in areas of Europe where we are not now represented, even as we consolidate our leading positions in the major markets of Western Europe.”