EU Probes Planned Staples-Office Depot Merger
September 25 2015 - 7:20AM
Dow Jones News
BRUSSELS—European Union regulators have opened a detailed
investigation into Staples Inc.'s $6.3 billion planned acquisition
of Office Depot Inc., warning the deal could lead to price
increases and less choice for business customers.
The deal, announced in February, would take the U.S. down to one
chain of office-supply superstores from three in just a couple of
years, after U.S. regulators approved Office Depot's acquisition of
OfficeMax in 2013.
In Europe, EU regulators said Friday that their preliminary
investigation had indicated competition might be harmed in the
market for the supply of office products to business customers.
Staples and Office Depot, together with their largest European
competitor Lyreco, are the main suppliers of office products to
business customers, the regulators said.
"The transaction could eliminate an important competitor and
reduce the choice of suitable suppliers in already concentrated
markets, which could lead to price increases," the EU said. It also
pointed to possible competition concerns regarding the wholesale of
office products in Sweden, "where the merging parties appear to
have no significant competitors offering a wide portfolio of
products."
"All companies and organizations, big or small, need office
supplies for their daily work," the EU's antitrust chief, Margrethe
Vestager, said in a statement. "We are opening this in-depth
investigation to make sure that the merger of two of the main
suppliers of office products will not have a negative effect on
competition."
Staples Chief Executive Ron Sargent said in August that he still
expects the deal to close by year-end despite recent opposition
from U.S. regulators to consolidation in other industries.
Write to Tom Fairless at tom.fairless@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
September 25, 2015 07:05 ET (11:05 GMT)
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