There is about to be one dominant office supplies retailer in the U.S. as Staples has made a play for Office Depot, and that could mean both good and bad things for consumers and small businesses. It also presents an interesting opportunity for investors in a newly formed market share leader for office supplies, one that expects to cut $1 billion in costs over three years to boost profits. On Wednesday, Staples announced that it will acquire smaller rival Office Depot for about $6.3 billion, capping an end to activist investor Starboard Value’s battle to get the two companies to combine. Should the deal be approved by regulators and close at the end of this year as Staples expects, in essence Staples will also own Office Max, which Office Depot bought in 2013 for close to $1 billion. Staples did not shed light on whether Office Depot stores would be rebranded as Staples or if Office Depot.com would live on. But what consumers should expect to see are local store closures as Staples seeks to appease inquisitive regulators. Cheaper prices for pens, paper and ink toner could also be in toe. As for small businesses, their weekly contracted delivery of Staples office supplies could become pricier as the retailer consolidates the market for these services. Brian Sozzi breaks down the transaction.
Subscribe to TheStreetTV on YouTube:
For more content from TheStreet visit:
Check out all our videos:
Follow TheStreet on Twitter:
Like TheStreet on Facebook:
Follow TheStreet on LinkedIn:
Follow TheStreet on Google+:
source
