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Count on paper clips from two sources for the near future. The Federal Trade Commission sued to block the Staples/Office Depot merger—just as it did 19 years ago.
The FTC says the merger would create a price-gouging duopoly, the same reasoning as last go-round, despite competition from rivals like Amazon and Walmart, Fortune reports.
The companies' stocks plummeted on the news. Staples shares dropped 12%; Office Depot shares saw a 17% decline. To win antitrust approval,the companies agreed to sell off Office Depot assets with revenues of up to $1.25B.
The company also offered to send $600M of corporate contracts to Essendant, a competitor based in Deerfield, IL. Apparently this didn't satisfy regulators.
The FTC decision comes on the heels of the Comcast-Time Warner Cable and Bumble Bee-Chicken of the Sea mergers crumbling under regulatory pressure. Must be a relief for the tuna connoisseurs out there. [Fortune]
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