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Federal regulators reject latest Staples-Office Depot merger proposal

Staples isn’t likely to get the gift it was hoping for this holiday season: federal approval of its move to merge with competitor Office Depot.

December 22, 2015

Staples isn’t likely to get the best gift it had hoped for this holiday season: federal approval of its move to merge with competitor Office Depot.

The Federal Trade Commission (FTC) voted down the $6.3 billion deal even after Staples volunteered to walk out from $1.25 billion in commercial contracts. The divestiture offer is the second one; the first offered to shut down $500 million in contracts, according to a Forbesreport. The FTC, in its latest, ruling did not offer any counteroffer insight.

While Staples hopes to continue negotiating with the FTC it’s also mulling potential legal action regarding the federal opposition and will likely head to court to request a full judicial review.

In previous media reports, the FTC challenges to the mega merger are tied to the fear that a merger would violate antitrust laws.

"By eliminating competition between Staples and Office Depot, the transaction would lead to higher prices and reduced quality," said the FTC in a statement, according to Forbes. 

The sparring on the merger move is not new to Staples as federal regulators quashed Staples' merger proposal to buy Office Depot 18 years ago.