Staples, Office Depot say FTC opposition to deal 'simply wrong'

Fri Mar 18, 2016 8:57am EDT
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(Reuters) - Staples Inc (SPLS.O: Quote) said the U.S. Federal Trade Commission's opposition to its $6.3 billion acquisition of Office Depot Inc (ODP.O: Quote) was "simply wrong" and that it did not take into account increasing competition from online retailers.

The FTC filed a lawsuit in December to block the deal. Hearing on the lawsuit starts on Monday in the U.S. District Court for the District of Columbia.

The FTC has said a merger between the two could reduce competition for nationwide contracts for office supplies.

It has also rejected Staples' raised offer to divest up to $1.25 billion of commercial contracts to secure approval for the deal.

The companies on Friday reiterated that the FTC's lawsuit was based on a flawed analysis of the office supplies marketplace and a deep misunderstanding of the competitive landscape.

They said the FTC had refused to acknowledge the rise of new competitors, such as Inc (AMZN.O: Quote), and the disruptive effects of the digital economy.

"This has been a long and frustrating road, but we look forward to a fair and impartial hearing," the companies said in a letter to customers.

(Reporting by Sruthi Ramakrishnan in Bengaluru; Editing by Saumyadeb Chakrabarty)

A shopping cart is seen outside a Staples office supplies store in the Chicago suburb of Glenview, Illinois, February 4, 2015. REUTERS/Jim Young