Staples, FTC Agree to Extend Review Period for Office Depot Takeover
Some analysts believe that the delay is a positive sign for Staples Inc. After a previous, and unsuccessful, attempt to buy Office Depot Inc. in 1996, U.S. regulators blocked the transaction in 1997.
"We wonder if the FTC would bother agreeing to an extension if it was dead set on blocking the deal," said BB&T Capital Markets analyst Anthony Chukumba to Reuters.
The extension gives both companies time to negotiate terms of the deal, including potential divestiture of large delivery accounts. Joseph Feldman, an analyst for Telsey Advisory Group, told Reuters that if the FTC requires both companies to give up some customers that sell to other businesses, the deal could fall through. But he also said that he saw a 60-to-65 percent chance that the FTC approves the deal.
Other businesses, such as Amazon Inc., W W Grainger Inc. and United Stationers Inc., could be potential buyers of Staples Inc.'s and Office Depot Inc.'s divested businesses.
The deal has already been approved by regulators in China, Australia and New Zealand. The companies said that the U.S. regulator will decide on the $6.3 billion deal on Dec. 8.