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Staples Inc. Chief Executive Ron Sargent will step down from the job next month, handing the reins to lieutenant Shira Goodman, after his strategy to acquire Office Depot Inc. was blocked earlier this month.
Sargent and the board "mutually agreed" on the move, which makes Goodman an interim CEO, the Framingham, Mass.-based company said in a statement Tuesday. Sargent will leave the job after the office-supply chain's annual shareholder meeting on June 14, though he will remain a director and nonexecutive chairman until Jan. 28.
Sargent had staked Staples' future on a $6.3 billion deal to acquire its main rival, Office Depot.
But the merger was blocked by regulators, who complained it would stifle competition and leave the U.S. with only one national office-supply chain. The would-be merger partners pointed to Amazon.com as a viable competitor, but the Federal Trade Commission and U.S. District Judge Emmet Sullivan rejected that argument.
"With the termination of the merger, we mutually agreed that now is the right time to transition to new management to lead Staples through its next phase of growth," said Staples' lead independent director, Bob Sulentic. "Shira has tremendous experience and a long track record of success at Staples, always bringing fresh perspective and change to every role she has had."
Sargent, 60, is stepping down after 27 years at Staples.
He leaves a company that still leads the market for office supplies but has struggled with declining sales and mounting online competition. Staples' shares, which have dropped 47 percent during the past year, were hammered after the Office Depot deal was blocked.
The stock fell an additional 1.3 percent to $8.69 on Wednesday in New York.
Sargent will receive his current salary and bonus until January. After that, he'll get monthly payments of $166,740 for two years, totaling about $4 million. The executive received a salary of about $1.2 million in the most recent year.
Goodman takes the interim CEO role after serving as president of Staples' North American operations. She has spent 23 years at the company, overseeing e-commerce, supply-chain management and other areas. As Staples' leader, she plans to focus on positioning the company for growth, according to the statement.
"I am confident that we can do so by intensifying our focus on our best growth opportunities with mid-market business customers in North America and in key categories beyond office supplies," she said.