Menu
US court blocks Staples’ multi-billion dollar acquisition of Office Depot

US court blocks Staples’ multi-billion dollar acquisition of Office Depot

Judge claims proposed merger would “substantially impair competition” in the sale and distribution of consumable office supplies to large Business-to-Business.

A US Federal judge has blocked Staples’ proposed $US6.3 billion acquisition of Office Depot, claiming that the merging of two industry giants would reduce competition in the market.

Citing rising price concerns for customers in the ruling, the collapse of the deal puts a stop to the combination of the two largest office supply retailers in America, halting a merger that also hit the blockers nearly two decades ago.

“Today’s court ruling is great news for business customers in the office supply market,” Federal Trade Commission, Director, Debbie Feinstein said in a statement.

“This deal would eliminate head-to-head competition between Staples and Office Depot and likely lead to higher prices and lower quality service for large businesses that buy office supplies.”

In the ruling, the judge claimed the proposed merger would “substantially impair competition” in the sale and distribution of consumable office supplies to large Business-to-Business.

Under the terms of the merger agreement, Staples will pay Office Depot a $US250 million break-up fee with the company also planning to terminate its agreement to sell more than $US550 million in large corporate contract business and related assets to Essendant in connection with the termination of the merger.

“We are extremely disappointed that the FTC’s request for preliminary injunction was granted despite the fact that it failed to define the relevant market correctly, and fell woefully short of proving its case,” Staples CEO, Ron Sargent, added.

“We believe that it is in the best interest of our shareholders, customers, and associates to forego appealing this decision, terminate the merger agreement, and move on with our strategic plan to drive shareholder value.

“We are positioning Staples for the future by reshaping our business, while increasing our focus on mid-market customers in North America and categories beyond office supplies.”

Read more: Reffind builds up customer portfolio

More to follow.

Follow Us

Join the New Zealand Reseller News newsletter!

Error: Please check your email address.

Tags StaplesOffice Depot

Slideshows

IN PICTURES: Ingram Micro Innovation hits Auckland with Hewlett Packard Enterprise

IN PICTURES: Ingram Micro Innovation hits Auckland with Hewlett Packard Enterprise

Ingram Micro completed its nationwide roadshow in Auckland last month, kicking off its Innovation Hour series with Hewlett Packard Enterprise. Uncovering the latest in storage, networking and servers, the event outlined key market trends for resellers in 2016 and beyond.

IN PICTURES: Ingram Micro Innovation hits Auckland with Hewlett Packard Enterprise
IN PICTURES: FireEye celebrates channel at 2016 Partner Conference

IN PICTURES: FireEye celebrates channel at 2016 Partner Conference

FireEye welcomed 143 channel partners and distributors to FireEye's 2016 annual Partner Conference, FireEye A/NZ Momentum - held at Establishment in Sydney. Delegates heard from senior trans-Tasman channel leaders, marketing and the product divisions in the morning, with FireEye customers, incident responders and threat intelligence analysts sharing knowledge during the afternoon.

IN PICTURES: FireEye celebrates channel at 2016 Partner Conference
​IN PICTURES: Disruption in the data centre - Can the Kiwi channel capitalise?​

​IN PICTURES: Disruption in the data centre - Can the Kiwi channel capitalise?​

With New Zealand businesses now open to innovation, the industry sits on the cusp of significant disruption in the data centre. Driven by software-defined networking, the future of the data centre is fast becoming reality, as the channel seeks to keep up, keep innovating and keep growing. APC by Schneider Electric, Lenovo and key partners outlined how the channel can capitalise at The Grill restaurant in Auckland.

​IN PICTURES: Disruption in the data centre - Can the Kiwi channel capitalise?​
Show Comments