Fusion of the Swivel Chair Titans: OfficeMax and Office Depot Agree on a Merger
Shares for both OfficeMax (NYSE:OMX) and Office Depot (NYSE:ODP) jumped on Tuesday following the announcement that the second-largest office supply retail firm (Office Depot) and the third-largest (OfficeMax) would merge, fundamentally changing the landscape of the $21.1 billion office supply industry, according to USA Today.
The deal would be all stock, reportedly. The shareholders of OfficeMax shares will receive 2.69 shares of Office Depot for every OfficeMax share they own, for a total of $1.2 billion in value. Tuesday, shares rose 21 percent for OfficeMax, or $2.25 per share. Office Depot also grew in value, and closed at 9.37 percent, or $0.43 per share.
However, news of the merger didn’t hinder performance for Staples (NASDAQ:SPLS), the nations largest office supply retailer. Staples shares were up by 13.13 percent, or $1.70 per share. Staples is the parent company of Quill Corp., the popular wholesale office supply company that was acquired by Staples in 1998. USA Today is reporting that analysts consider the merger to be beneficial for Staples, since it will undoubtedly result in the closing of at least a handful of locations nationwide. Combined, OfficeMax and Office Depot have about 2,575 stores in North America.