Feds seek to block Staples-Office Depot merger
The Federal Trade Commission on Monday acted to to derail Staples' $6.3 billion offer for Office Depot, arguing the merger of the two largest office-supply chains would harm competition and lead to higher prices for consumers.
The agency believes the proposed merger "is likely to eliminate beneficial competition that large companies rely on to reduce the costs of office supplies, FTC Chairwoman Edith Ramirez said in a statement. "The FTC's complaint alleges that Staples and Office Depot are often the top two bidders for large business customers."
In a joint statement, Staples (SPLS) and Office Depot (ODP) said they intend to contest the FTC decision to challenge their merger, saying it was based on "a flawed analysis and misunderstanding of the intense competitive landscape in which Staples and Office Depot compete."
The two rivals in February announced the cash-and-stock deal, with the planned purchase unveiled a little more than a year after Office Depot combined with OfficeMax.