UPDATE: On Feb. 4, 2015, the Associated Press confirmed that Staples will buy Office Depot for $6.3 billion. Through the cash-and-stock deal, all Office Depot shareholders will receive $7.25 per share in cash. At closing, Staples also will give shareholders 0.2188 of its shares for each Office Depot share. The deal is expected to close by the end of 2015.
Below is Retail TouchPoints’ original coverage of the deal, which was published on Feb. 3, 2015.
Approximately three months after Office Depot completed its acquisition of OfficeMax, the office supply retailer is in advanced talks with Staples Inc. to combine companies, according to The Wall Street Journal. However, sources familiar with the matter say there is “no guarantee a deal will be reached.”
Together, the two companies operate approximately 4,000 stores and bring in annual sales of more than $35 billion. However, both Office Depot and Staples have faced their fair share of struggles as retail behemoths like Amazon and Walmart have acquired a larger share of the office supply market. In fact, same-store sales for U.S. Staples locations have not increased since 2007. Office Depot’s U.S. same-store sales have been stalled since 2006.
Both chains also have been closing stores nationwide. In spring 2014, Staples announced plans to shutter up to 225 stores nationwide during the year, while Office Depot closed 20 locations in Q3 2014 alone.
But overall, both retailers have focused on creating more seamless, omnichannel customer experiences. During a presentation at the 2015 Nation Retail Federation BIG Show, a Staples executive spotlighted the benefits of focusing more on digital channels, as they are impacting more sales than traditional ones. Also recently, Office Depot implemented the LiveContext solution from CoreMedia to create more immersive online shopping experiences via desktops and mobile devices.