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After some tough fighting, Staples, Inc. (NASDAQ: SPLS) has won its bid for Corporate Express N.V., one of the world's largest suppliers of office products to businesses and institutions. The deal comes to about $2.6 billion in an all cash transaction. What's more, Corporate Express has agreed to abandon its purchase of rival Lyreco (which was really a defensive ploy anyway).
To get to this point, Staples had to increase its bid several times, from 7.25 euros to 9.25 euros. But, it was probably worth it. After all, the core retail business is lagging.
Basically, Corporate Express will provide a strong distribution platform in North America, Canada and Europe. Moreover, the business is growing and there should be some cost savings because of overlap and economies of scale, although these haven't been estimated yet.
With the deal, Staples will have annual revenues of $27 billion and 94,000 employees across 28 countries.
And, so far in today's trading, shares in Staples are up 3.71% to $24.01.
Tom Taulli is the author of various books, including The Complete M&A Handbook
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