Office Depot has rejected Staple's $2.1B takeover deal. However, the company said it is open to selling its retail and e-commerce operations to Staples, or a joint-venture rather than a full-blown takeover.
- Last week, Staples offered to buy Office Depot for $2.1B in cash. The proposal came five years after the FTC blocked Staples and Office Depot's merger, citing that eliminating competition would lead to higher prices for consumers. The merger of the two companies was also blocked earlier, in 1997.
- Office Depot's parent company ODP also owns IT services business CompuCom and OfficeMax chain. In 2019, ODP's B2B operations contributed to 50% of its $10.6B revenue, compared to 40% by retail operations and 9% by CompuCom.
- Office Depot noted that combining its retail operations with Staples' would be less likely to face regulatory scrutiny and could lead to cost savings. The company added that it is already in the process of selling CompuCom.
- As investors expect some sort of deal to go through, ODP's shares are up 26% since Staples announced its initial bid.