Staples May Exit The Retail Scene By Spinning Off Its 1,500 Stores To Office Depot
When the Federal Trade Commission blocked Staples and Office Depot’s $6.3B merger in 2015 on antitrust concerns, Staples later struck a $6.9B deal to sell to private equity firm Sycamore Partners. Now the office supply retailer may have found a way around the FTC’s concerns about the two rivals merging by spinning off its retail locations to Office Depot.
Should the deal go through (pending approval from Sycamore), Office Depot would take over Staples’ 1,500 stores, creating the country’s only big-box office supply retailer, the New York Post reports. This deal may have less trouble getting through the FTC because it is strictly about real estate and less of a threat, Yahoo News reports. The previous merger attempt would have included Staples’ lucrative business sales, which includes selling products directly to companies.
Under this new deal, Sycamore would still own Staples' business with corporate clients and would offload the stores, which sources told the New York Post the private equity firm is open to doing.