September 14, 2018

Staples to acquire Illinois company for $996M

Photo/Grant Welker
Staples' Framingham headquarters

Framingham office supply retailer Staples said Friday it will acquire an Illinois-based company for nearly $1 billion.

Staples will purchase the outstanding shares of office furniture wholesaler Essendant's common stock for $12.80 a piece for a transaction value of $996 million.

The deal comes after several months of a bidding war between Staples and Genuine Parts Co. of Atlanta that seemingly ended this week when Essendant said it favored Staples' proposal.

Essendant said Monday its board has determined Staples' offer was better for the company than the merger agreement with Genuine Parts and its S.P. Richards business, which was first announced in April.

The $12.80 per share transaction is higher than Staples original unsolicited offer of $11.50 in May.

Essendant, which announced a merger agreement with Genuine Parts Co. in April, has terminated that agreement. As part of the termination, Staples is paying Genuine Parts Co. a $12 million break-up fee.

Essendant Chairman Charles Crovitz in a statement said the extended regulatory process and risks associated with the S.P. Richards transaction led to the decision to instead partner with Staples.

"While our agreement to merge with S.P. Richards presented an attractive opportunity, we believe the Staples transaction provides superior and immediate value to our shareholders," he said.

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