UPDATE 1-Rona says looking to sell assets, focus on distribution

* Company says will return to roots as distributor

* Rona promises simpler structure, quarterly updates

* Shares rise almost 2 percent

Dec 6 (Reuters) - Canadian hardware retailer and distributor Rona Inc will sell assets and simplify its operations as part of a back-to-its-roots strategy designed to turn its fortunes around, the company's interim chief executive said on Thursday.

Dominique Boies, who took the reins at Rona following last month's exit of long-time CEO Robert Dutton, said he plans to bring profit margins in line with industry standards with his changes, which will shift the company's focus back to its roots as a hardware distributor.

Rona, Canada's largest distributor and retailer of hardware, home renovation and gardening products, has grown through a series of strategic acquisitions.

But the Quebec-based company has stumbled in recent years amid strong competition from U.S. giants Home Depot and Lowe's Cos Inc, and earlier this year it was the target of an unsolicited C$1.8 billion ($1.82 billion) takeover proposal from Lowe's.

Lowe's withdrew its proposal in mid-September in the face of stiff opposition from both provincial politicians in Quebec and from many of Rona's independent dealers.

Dutton stepped down early last month, soon after the company announced yet another quarter of disappointing results, a departure that prompted speculation that the company could be back in play.

NEW DIRECTION

Rona gave no hint of that in Thursday's statement, but Boies acknowledged the company's operations have become too complex.

"RONA's nationwide growth did not come without a certain level of complexity," he said.

He said Rona plans to simplify its business model and boost its focus on distribution as it disposes of non-core assets and redeploys capital.

The company will offer quarterly updates on its initiatives and performance, and Boies said he will meet with investors and stakeholders in coming weeks to discuss Rona's strategic and financial priorities.

Last month, following the disappointing results, Invesco Canada Ltd, one of Rona's largest investors, called for the removal of the company's board.

Rona did not say if it has begun talks with Invesco. Shares in Rona rose 2.7 percent to C$10.42 soon after the Toronto Stock Exchange opened on Thursday.