The opinion issued today by U.S. District Court judge Emmet Sullivan doesn’t actually say that the country’s biggest office supply chain, Staples, can’t acquire the #2 office supply chain, Office Depot. While the injunction prevents the companies from merging until administrative proceedings at the Federal Trade Commission have concluded, the two companies have previously said that they would break their engagement if the judge came back with an injunction.
In hearings a few weeks ago, the two office supply stores didn’t even bother to put up a defense, claiming that the FTC’s case was weak and the judge should simply let Staples go ahead and acquire Office Depot already.
The FTC’s case didn’t have much to do with the concerns of regular consumers: we, after all, can go by our pens and notebooks and printer cartridges in warehouse or discount stores, or order them up from Amazon. Their concern was with the companies’ commercial business supplying big and small companies and wholesalers with office supplies. There are no effective national competitors in that sector, the FTC argued.
The judge agreed, writing, “there is a reasonable probability that the proposed merger will substantially impair competition in the sale and distribution of consumable office supplies to large Business-to-Business customers.”
While the companies proposed selling a portion of their commercial office supplies business to an ascendant competitor that would like to have more of a national presence, the judge still issued an injunction.
by Laura Northrup via Consumerist