Staples is the world's largest office products company, serving consumers and businesses in 25 countries worldwide. It was the world's first office supplies superstore when it was founded in 1986, and began to establish a global presence in the 1990s, initially through local partnerships, and later with acquisitions including Neat Ideas in the UK and Corporate Express in the Netherlands and other countries. In recent years, though, traditional office supplies retailers have been hit hard by competition from Walmart, Target and Amazon. In 2015, in an attempt to bolster its position, Staples agreed to acquire its main rival Office Depot for $6.3bn. However, the merger was challenged by the FTC. The two companies went to court to argue their case but without success. (A similar attempt to merge had also been blocked in 1997). The plan was abandoned in 2016, forcing Staples to seek a new strategy. It began to offload its international network later that year, with deals to sell its European and Australasian stores in early 2017. Shortly afterwards it was acquired by private equity investor Sycamore Partners for $6.9bn. Staples' last declared results were for for the year to Jan 2017. Revenues were $18.2bn, and the group reported a $1.5bn net loss as a result of impairment charges against discontinued operations. Staples had around 1,560 stores in North America as well as a wide-reaching direct delivery service. A few international stores continued to operate in Latin America, as well as a delivery service in China. No further corporate information has been published since then. Shira Goodman succeeded Ron Sargent as group CEO in 2016, but was herself replaced in 2018 by former Coke executive Sandy Douglas. Current revenues are thought to be around $16bn. The company has moved more aggressively towards ecommerce with a series of acquisitions including HiTouch Business Services and Essendant in 2018 and imaging technology specialist DEX in 2019. Staples was originally founded by Tom Stemberg and Leo Kahn, rival supermarket operators who joined forces with the aim of adopting the warehouse-style deep discount format already used by Toys R Us, and then being implemented in other retail sectors by the likes of Walmart and Home Depot. They considered several different market sectors before settling on office supplies. In 2021, Staples launched a new offer - its third since 1997 - to acquire Office Depot. However, progress has been hampered by Office Depot's refusal to sell its B2B operations.
Capsule checked 9th April 2021
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Adbrands Daily Update 19th Jan 2021: Office Depot declined Staples' merger offer but said it would consider an alternative that might get around most regulatory obstacles. According to the WSJ, instead of a full takeover, Office Depot has suggested the transfer of just its consumer retail and ecommerce operations, but not the corporate and business supplies division.
Adbrands Daily Update 12th Jan 2021: In the light of the plunging pandemic-impacted retail sector, Staples launched yet another attempt to merge with rival Office Depot. The latest offer values the smaller rival at around $2.1bn, a third as much as Staples' last offer in 2015. That bid and another earlier proposal in 1997 were blocked by antitrust regulators. However, Staples reiterated its argument that fierce competition from Amazon, Target and Walmart has severely dented its own and Office Depot's share of the office products sector, just as it had predicted in 2015. The new offer was unsolicited, and Office Depot has yet to give its own opinion on the proosed merger. Staples hopes to get around another rejection by pledging to sell Office Depot's commercial business operations CompuCom.
Adbrands Weekly Update 20th Sep 2018: Office products retailer Staples has agreed to acquire wholesaler and distributor Essendant for $483m, derailing an earlier bid by rival Genuine Parts. Essendant wholesales a wide variety of products including cleaning and industrial supplies, office furniture and products and technology items to around 30,000 resellers and end users.
Adbrands Weekly Update 1st Feb 2018: Veteran Coca-Cola executive Sandy Douglas was named as the new CEO of struggling office products retailer Staples. He takes over from Shira Goodman. Douglas spent almost three decades at Coke, but left the group last year after being passed over for the top job.
Adbrands Weekly Update 29th Jun 2017: Office products retailer Staples is to go private in a buyout by investment firm firm Sycamore Partners for around $6.9bn. Staples and rival Office Depot have been under immense pressure in recent years from Amazon on one side, and Walmart and Target on the other. A recent attempt by the two companies to merge with one another was blocked by competition regulators, forcing Staples to sell off most of its international division to boost its declining performance.
Adbrands Weekly Update 6th Apr 2017: Office products retailer Staples said it is in talks with one or more possible private equity buyers. The global #1 in its sector, it has been struggling to compete with general retailers such as Walmart and Amazon. An attempt to bolster its position through a merger with smaller rival Office Depot, also ailing, was blocked by regulators. Earlier this year, in order to focus its attention on the North American market, Staples agreed separate deals to divest its operations in Europe and Australasia.
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