FTC Votes To Block Staples-Office Depot Merger
WASHINGTON - The Federal Trade Commission voted today to block a merger of the nation's two largest office-supply retailers.
The commission said it would seek a court order to prevent Staples from acquiring Office Depot. The agency likely will file the suit before Thursday, when the latest antitrust review period is set to expire.
In raising its objections, the FTC said the $4 billion acquisition would allow the combined company, which would have about 1,000 superstores, to control prices for the sale of office supplies in various cities throughout the country.
Both companies said they would oppose the FTC's decision in court.
"We will vigorously contest this," said Staples Chairman and Chief Executive Tom Stemberg.
Office Depot's Chairman and Chief Executive David Fuente said, "With thousands of competitors, we are shocked by the FTC's decision." He said that U.S. office-supply sales total $185 billion and that the two companies have just 5 percent to 6 percent of that.
However, William Baer, director of the FTC's bureau of competition, said, "The fact is that in those communities where Staples faces competition from Office Depot, prices are significantly lower than where it does not."