UPDATE 2-U.S. files complaint to stop Staples from buying Office Depot

Mon Dec 7, 2015 3:03pm EST
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

(Adds background and share price)

Dec 7 (Reuters) - The U.S. Federal Trade Commission said it has filed a complaint aimed at stopping Staples Inc, the nation's largest office supply store, from buying its top rival, Office Depot Inc.

Canada's Competition Bureau also said on Monday it would challenge the proposed transaction, which has received the green light from competition authorities in China, Australia and New Zealand.

Office Depot's shares fell as much as 17.6 percent to a year low of $5.46, while Staples' stock dropped 13.6 percent to a year low of $10.68.

"The commission has reason to believe that the proposed merger between Staples and Office Depot is likely to eliminate beneficial competition that large companies rely on to reduce the costs of office supplies," FTC Chairwoman Edith Ramirez said in a statement. (1.usa.gov/1NeaaD9)

The FTC said Staples and Office Depot were often the top two bidders for large business customers and the deal would hurt customers who wanted nationwide contracts for office supplies.

The companies said in a statement on Monday that they would fight the FTC in court, arguing that they face stiff competition from manufacturers who sell their own products, e-commerce companies, big box stores and others.

The deal is also being investigated by EU regulators, who in September raised concerns about possible price hikes.

The FTC stopped a merger attempt between the same two companies in 1997 on similar concerns.   Continued...