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Staples offers to buy Office Depot for $2.1 billion

January 11, 2021. Summarized by summa-bot.

Compression ratio: 61.5%. 1 min read.

Staples is once again proposing to buy rival Office Depot in a $2.1 billion deal, five years after the US government squashed their prior merger agreement.

New York (CNN Business)Staples is once again proposing to buy rival Office Depot in a $2. 1 billion deal, five years after the US government squashed their prior merger agreement.

The $40-per-share offer price for Office Depot's parent company, ODP Corp. , is a roughly 60% premium over its average closing price for the last 90 trading days.

The all-cash transaction, according to Staples, is a "compelling value proposition" and is a "superior to the intrinsic, standalone value" of Office Depot.

Office Depot (ODP) shares soared about 10% in premarket trading.

Staples said it's "prepared to take all necessary measures" to get the merger approved by the Federal Trade Commission, which said in 2015 that the combination would give the combined companies too large a chunk of the office supply retail market and would violate antitrust law.

To avoid antitrust scrutiny, Staples proposed selling its IT management company CompuCom or its business-to-business unit.

Staples and Office Depot have faced intense competition from retail stores that are not traditional office suppliers like Amazon (AMZN) and Walmart (WMT).

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