Undaunted by its previous two attempts being blocked by the Federal Trade Commission (FTC), Staples is once again trying to purchase its competitor Office Depot
Undaunted by its previous two attempts being blocked by the Federal Trade Commission (FTC), Staples is once again trying to purchase its competitor Office Depot
Staples' last attempt to purchase Office Depot was in 2016 when the former tried to acquire the latter for $6.3 billion. The merger was stopped by litigation from the FTC, which sued on antitrust grounds. At the time, the FTC voiced its concern that the merger would give the resulting combined company too much market share. A federal judge sided with the FTC, forcing Staples and Office Depot to call off the attempted merger.
Staples' last attempt to purchase Office Depot was in 2016 when the former tried to acquire the latter for $6.3 billion. The merger was stopped by litigation from the FTC, which sued on antitrust grounds. At the time, the FTC voiced its concern that the merger would give the resulting combined company too much market share. A federal judge sided with the FTC, forcing Staples and Office Depot to call off the attempted merger.
Staples appears prepared for regulatory challenges, having learned a few lessons from the attempt made five years ago. In its letter to Office Depot's board of directors, the company stated that it would be willing to take whatever measures necessary to receive the FTC's blessing, including spinning off divisions to other companies. The letter also indicated that Staples would be willing to acquire all of Office Depot's outstanding shares in a public tender deal if the FTC blocks the second deal.
Staples appears prepared for regulatory challenges, having learned a few lessons from the attempt made five years ago. In its letter to Office Depot's board of directors, the company stated that it would be willing to take whatever measures necessary to receive the FTC's blessing, including spinning off divisions to other companies. The letter also indicated that Staples would be willing to acquire all of Office Depot's outstanding shares in a public tender deal if the FTC blocks the second deal.
The matter will likely be one of the first major corporate hurdles of the Biden administration, which is set to take control of the White House next Wednesday. President-elect Joe Biden has not tapped anyone for the head of the FTC just yet, and there's still a degree of uncertainty concerning his stance on antitrust concerns. Additionally, a new precedent has been set for stricter antitrust measures by the government's actions against tech companies such as Alphabet
The matter will likely be one of the first major corporate hurdles of the Biden administration, which is set to take control of the White House next Wednesday. President-elect Joe Biden has not tapped anyone for the head of the FTC just yet, and there's still a degree of uncertainty concerning his stance on antitrust concerns. Additionally, a new precedent has been set for stricter antitrust measures by the government's actions against tech companies such as Alphabet
Staples was taken private by Sycamore Partners after its failed 2016 deal, but Office Depot, which is publicly traded on the NASDAQ exchange, received a sizable bump from the news of the potential merger. By the time of writing on Tuesday, ODP shares were up 11.8% since Monday's open.
Staples was taken private by Sycamore Partners after its failed 2016 deal, but Office Depot, which is publicly traded on the NASDAQ exchange, received a sizable bump from the news of the potential merger. By the time of writing on Tuesday, ODP shares were up 11.8% since Monday's open.
