Office Depot Takes Over OfficeMax to Take on Staples, Amazon (Update1)
"The competitive landscape within the office-products retail channel has dramatically changed since the FTC nixed the proposed 1997 merger between Staples and Office Depot," Jefferies' Binder wrote.
"The rise of large players in the Internet retail channel and the entrance of club and mass channel to the office product market resulted in a significant increase in price transparency and competition," he added, while noting that Wal-Mart and Amazon have undercut prices up to 10% in some instances.
Shares of Office Depot, which has been struggling to compete with larger rival Staples, plunged 67% over the past five years prior to Tuesday trading, when reports of a deal first surfaced.
-- Written by Antoine Gara in New York
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