Office Depot Inc., Delray Beach, FL, has acquired the remaining 50% of its Japanese operations from its joint venture partner Deo Deo Corp. for approximately $28 million. Office Depot now owns 100% of its operations in Japan.
"Japan will be an important market for the Office Depot and Viking brands, as it is the second largest office products and services market outside of the U.S.," said Office Depot International president Bruce Nelson in a statement. "While the company's initial retail efforts will be focused on the Tokyo market and surrounding areas, the company will launch its first direct mail effort across the entire country under the Viking brand name in the first week of April."
The company currently estimates the losses from its operations in Japan to reach $25 million -$30 million pretax during 1999. In addition, the company currently anticipates taking a charge in the range of $15-$20 million pretax in second quarter 1999 to reflect costs associated with restructuring its Japanese operations in light of its purchase of 100% control and its planned consolidation of the Office Depot and Viking operations.
Office Depot started doing business in Japan in 1997 and now operates three superstores and three delivery centers. The company's Viking subsidiary established distribution and administrative facilities in Japan in 1998.
