The rumor mill is churning and, as of today (July 31), there have been futher talks of Office Depot potentially engulfing Staples‘ brick-and-mortar locations. As PYMNTS recently reported, Staples was acquired by Sycamore Partners for $6.9 billion about a month ago.
With 1,500 Staples store locations at its disposal, Office Depot would take the reigns on possibly the largest big box office supply retail chain in the country. The latest talks stemmed from Staples’ public filing at the beginning of June in which it revealed there were two parties involved in the bidding war to snap it up.
Despite Office Depot’s $625 million to $700 million offer, Sycamore Partners won the battle.
Sycamore Partners’ main interest in Staples, however, was to own the corporate side of the business, which sells paper, pens, ink cartridges and other office supplies to medium-to-large sized organizations. As such, Sycamore Partners may now be willing to sell off the physical storefront spaces to concentrate on distribution.
Following two previously disappointing outcomes to join forces with Staples — once in 1997 and once in 2015 — the pressure from competitor Amazon to make profits may prove too strong for Office Depot to ignore. Amazon is on the heels of the office supply arena with its recent announcement its Amazon Business offering has grown 150 percent to serve one million business customers since its launch just two years ago.
While none of the parties mentioned have spoken publicly about this potential office supply chain mega merger, it’s likely that we’ll see news by the end of this year.