As the retailers look to gain approval for their potential merger, Staples and Office Depot jointly announced an agreement to sell more than $550 million in operations including large corporate contract business and related assets to workplace products wholesaler Essendant for $22.5 million.
More than a quarter of the revenue acquired by Essendant will be from Fortune 100 companies and approximately half of the revenue will come from Fortune 500 companies, Staples and Office Depot stated.
The transaction is subject to the successful completion of the proposed merger of Staples and Office Depot currently tied up in litigation arising from United States Federal Trade Commission action to prevent the two retailers from merging, as well as other customary closing conditions.
The commercial business and assets the companies plan to divest relate primarily to accounts held by Staples and Office Depot acting as wholesalers to minority and woman-owned office supply resellers, they noted. The acquisition will significantly increase Essendant’s presence with large corporate customers, improve its capabilities and further enable independent dealers in combination with Essendant to more effectively compete for national account businesses.
“We’re pleased to reach this agreement with Essendant as we continue to work to complete the acquisition of Office Depot,” said Ron Sargent, Staples chairman and CEO. “Our agreement with Essendant strengthens a national competitor, further enables independent office products dealers, and helps minority and woman-owned businesses compete for national commercial customers.”