The rapidly changing tools of the workplace and the way people shop have led to another consolidation in the retail office supply business as Staples announced the $6.3 billion acquisition of rival Office Depot.
The cash-and-stock deal comes a little more than a year after Office Depot combined with OfficeMax, with too many stores fighting for too few sales.
The two companies, which forged the merger after pressure from activist investor Starboard Value, will create a retail chain with $39 billion in revenue and thousands of stores.
The deal will draw scrutiny from the Federal Trade Commission, though regulators have been increasingly willing to approve retail mergers in light of burgeoning e-commerce competition.
Businesses and consumers have shifted rapidly to online shopping at the same time that printers and the use of other traditional office supplies have diminished. That shift coincided with a recession that substantially altered the way companies spend money.
Office Depot shareholders will receive $7.25 in cash and 0.2188 shares in Staples. The transaction values Office Depot at $11 per share. The companies put the deal’s equity value at $6.3 billion.
Staples has a market capitalization of approximately $11 billion, while Office Depot, which combined with OfficeMax in November 2013, has a market capitalization of about $4 billion.
The two companies began talking about a buyout in September, they said.
Staples said it will realize at least $1 billion in annual cost savings by the third full fiscal year after the transaction is complete.
“These savings will dramatically accelerate our strategic reinvention, which is focused on driving growth in our delivery businesses and in categories beyond office supplies,” Staples chairman and CEO Ron Sargent said in a statement.
Sargent will continue to serve in those roles and Staples will keep its corporate headquarters in Framingham, Mass.