Feds Seek to Block Proposed Office Supplies Mega-Merger

Find out why U.S. antitrust regulators are prepared to block Staples’ acquisition of Office Depot.

Staples’ efforts to purchase rival Office Depot for $6.3 billion may be thwarted by the Federal Trade Commission.

The agency is poised to block the proposed union of the two largest commercial office suppliers in the United States amid pricing concerns. The merger will create a single nationwide office supply company to serve corporations and the government, The New York Post reports. Some estimates indicate that Staples and Office Depot handle all the office supply contracts for Fortune 1000 companies.

In what it called a win for consumers, U.S. regulators successfully blocked Staples’ first attempt to buy Office Depot in 1997 citing similar concerns about the merger hurting competition and violating federal antitrust laws.

The Post reports that the FTC’s four-person panel is split on its decision. Staples has offered some concessions to ease regulators’ concerns, including an offer to sell its commercial supply business to competitor Essendant.

“Nevertheless, it does not turn Essendant into a nationwide supplier to rival a combined Staples-Office Depot,” the Post said.

The Staples-Office Depot merger is also being investigated by European regulators.

The FTC has until Dec. 8 to issue a decision on the office supply mega-merger. The agency can also choose to extend its review in an effort to get more concessions from Staples.

What do you think of the office supply giants’ efforts to join forces? Share your comments below or on our Facebook page.

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