Retail Merger Update: Staples-Office Depot May Merge, Dollar Tree Could Shed More Stores
Eighteen years after a failed attempt to combine two of the country's biggest home, office and school supply stores, another try may be nearing the finish line. Staples is reportedly in late stage talks to acquire Office Depot at the behest of activist investor Starboard Value, which owns 6% of the former and 10% of the latter. If merged, the retailers would operate 4.4K stores and take in roughly $34B in annual sales.
Regulators wary of the dominant force a Staples-OD pairing would create in 1997 blocked that earlier proposed merger. But the FTC OK'd the latest union back in November 2013, citing increased competition from big box stores like Target and Costco.
In other retail merger news, discount giant Dollar Tree is under scrutiny by antitrust forces as it prepares to acquire rival Family Dollar. The company admitted this afternoon that it may have to divest more than the previously projected 300 locations in order to move ahead with the acquisition.