Staples acquires Office Depot for $ 6.3 Billion

Staples acquires Office Depot for $ 6.3 Billion

Staples acquires Office Depot for $ 6.3 Billion

Staples agreed to buy Office Depot for $ 6.3 Billion in cash and stock deal. This deal comes after long term pressure from hedge fund Starboard Value. Staples started to looking at the deal last summer, and talks with Office Depot in September.

 Staples will pay $7.25 in cash and 0.2188 of a share in Staples Stock for each Office Depot share. Its with 44 percent premium of Office Depot’s stock price on Monday trading.

 “Paper based office supplies are being replaced by technology, customer demand continues to shift online, we’re going up against a wider set of competition,” Mr. Sargent said. “This transaction creates significant value for Staples and Office Depot shareholders.”

Ron Sargent, CEO of Staples , said that the company expected at least $1 billion of savings through the merger. “These savings will dramatically accelerate our strategic reinvention which is focused on driving growth in our delivery businesses and in categories beyond office supplies,” he said in a statement.

“This transaction delivers great value for our shareholders and creates a company ideally positioned to serve our customers and grow over the long term,” Roland Smith, the chief executive of Office Depot, said in a statement. “It is also an endorsement of our many accomplishments and the tremendous success we’ve had integrating Office Depot and OfficeMax over the past year. We look forward to bringing our experience and knowledge to the new organization.”

The companies expected to close the deal by end of this year. Staples Board of Directors will increase to 13, from 11, adding two Office Depot directors.

 Staples financial advisor is Barclays and Wilmer Cutler Pickering Hale and Dorr, and Weil, Gotshal & Manges acted as legal advisors.

 Peter J. Solomon Company advised Office Depot, while Simpson Thacher & Bartlett acted as legal advisor.

 

Mr. Stakebay says:

Combination of both companies will operate about 4,400 stores with sales of roughly $ 34 billion with expecting $ 1 billion in cost savings. This deal is continuing consolidation in the office supplies market. Staples estimates one-time costs of approximately $1 billion to achieve its synergy target.

Chairman and CEO of Staples …………….Ron Sargent……..2002 – present…….$ 10 676 880 (2013)

Chairman and CEO of Office Depot……..Roland C. Smith….. 2013 – present…..  $ 19 649 273 (2013)

STAPLES

OFFICE DEPOT

Revenue

$ 23.114 Billion (2013)

$ 11.242 Billion (2013)

Operating income

 $ 707 Million (2013)

$ – 205 Million (2013)

Profit

$ 620 Million (2013)

$ – 20 Million (2013)

Total assets

$ 11.174 Billion (2013)

$ 7.477 Billion (2013)

Total Equity

 $ 6.140 Billion (2013)

$ 2.064 Billion (2013)

Employees

83 000 (2013)

64 000 (2013)

 

 

 

You Might Also Like

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>