May 5, 2021 - Economy

Office Depot to spin off distribution business into separate company

An Office Depot store in downtown Denver.

Photo: Robert Alexander/Getty Images

Office Depot today disclosed plans to spin off its commercial distribution business into a separate company, via a tax-tree transaction.

Why it matters: This may help clear the path for an acquisition of Office Depot by Staples, whose 1996 and 2015 takeover efforts were thwarted by antitrust regulators.

  • Staples, now owned by Sycamore Partners, made a third offer earlier this year that ODP rejected, but with the caveat that the board was open to future discussions.

Bottom line: "ODP said it would retain its retail consumer and small-business products and services, while separating its Business Solutions Division contract unit and independent regional office-supply distribution operations," Bloomberg writes.

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