Office supplies retailer Staples said that it made an offer to buy Office Depot owner ODP Corp for $2.1 billion in cash, nearly five years after its second takeover effort was rejected. The U.S. Federal Trade Commission blocked Staple’s $6.3 billion offer in 2016, saying a merger between the two could reduce competition for nationwide contracts for office supplies. Staples was a public company when it attempted the acquisition. It went private in 2017.

On January 11, the ODP Corporation confirmed that it has received a proposal to acquire the Company from USR Parent, Inc., the parent company of Staples and a portfolio company of Sycamore Partners.

Consistent with its fiduciary duties, ODP’s Board of Directors is carefully reviewing the proposal in consultation with its financial and legal advisors to determine the course of action that it believes is in the best interests of the Company and its shareholders. The Company noted that, according to its letter to ODP, USR Parent expects the regulatory process to take at least six months.

While the Board review is underway, the Company and its employees remain focused on positioning the business to deliver value for stakeholders through the implementation of its strategy to build upon the capabilities of its B2B platform, supported by its “Maximize B2B” restructuring plan, to drive future growth, achieve cost savings and pave the way for an enhanced competitive profile that builds on its unique strengths.

Staples currently own about 5% of outstanding shares of Office Depot. “Staples has sufficient resources to finance the transaction, so our obligation to proceed with the transaction is not subject to a financing contingency,” the letter sent to the board of directors of ODP said. Staples would be prepared to sell some units of Office Depot to unlock value and escape antitrust concerns from US regulators, according to the letter. And in the event that Office Depot and Staples can not agree on a deal, Staples plans to launch an all-cash tender offer for 100% of ODP stock in March.

Source: Reuters
Source: Market Insider
Source: The ODP Corperation