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Staples offers to buy Office Depot owner nearly five years after second takeover bid rejected

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Office supplies retailer Staples on Monday said it made an offer to buy Office Depot owner ODP Corp for US$2.1 billion in cash, nearly five years after its second takeover effort was rejected.

The U.S. Federal Trade Commission blocked Staple’s US$6.3 billion offer in 2016, saying a merger between the two could reduce competition for nationwide contracts for office supplies.

The two companies agreed to merge in 1996, but the deal was put to rest as a government lawsuit argued the move would have meant higher prices for pens, paper and other office supplies.

Read more: Canada’s retail sales rose for the sixth straight month in October

Staples was a public company when it attempted the acquisition. It went private in 2017.

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Staples said it is prepared to take “all necessary measures” to divest ODP’s B2B Business to a FTC approved and qualified buyer.

USR Parent Inc, or Staples, said it would offer US$40 per for each ODP share, a premium of 8.2 per cent to Friday’s close.

ODP’s shares rose about 11 per cent to US$41 before the opening bell.

(Reporting by Nivedita Balu in Bengaluru; Editing by Bernard Orr)