Shares of Office Depot (NYSE:ODP) rose on word that a hedge fund has acquired a significant stake in the company and was pressuring its management to make changes.
In a letter to Office Depot’s board, Starboard Value announced that it had acquired 13.3% of the retailer’s shares, making it the chain’s largest single shareholder, the New York Times noted.
Noting that Office Depot’s share price has lagged its competitors like Staples (NASDAQ:SPLS) and Office Max (NYSE:OMX), Starboard Value called on the company’s management to slash costs and sell assets.
Shares of Office Depot climbed more than 5% in Monday afternoon trading.
Starboard noted the the office product retailer had made some moves to address its sluggish performance, but called for more dramatic efforts.
Among Starboard’s specific recommendations is selling the chain’s 50% stake in a Mexican joint venture, potentially worth $900 million.