Amazon Considering Expanding its Office-Supply Business with Office Depot Deal

The New York Post reports that Amazon may be expanding its footprint in the office-supplies business, as it’s said to be considering acquiring the corporate business unit of Office Depot, according to an activist investor familiar with the matter. Office-supply superstore Staples is also seeking to acquire Office Depot for some $6 billion, but has been blocked by the U.S. Federal Trade Commission, which filed a lawsuit in September 2015 seeking to block the merger (see story here).

Amazon CEO Jeff Bezos may also be seeking to acquire privately held W.B. Mason, said to be the number-three office-supplier.

In April 2015, Amazon announced that it was starting Amazon Business. Last October, it sought to expand its sales of ink- and toner-cartridges with the announcement of its “Dash” program for select Brother and Samsung printers and MFPs. Under the Dash program, the printers and MFPs are monitored, and when ink or toner is low, replacement ink and toner is automatically shipped to customers, who pay a monthly subscription fee.

While Amazon has its own distribution centers, it’s said to be likely that it would use some of Office Depot’s corporate accounts to jump-start its new office-supply business.

Staples reported last week that it met with officials from the Federal Trade Commission (FTC) to discuss a possible settlement, but didn’t provide any details. The FTC’s suit to block the Office Depot-Staples merger goes to trial in a Washington, D.C., federal court next week. The FTC maintains that the merger would result in too much concentration in the national office-supplies market. Before suing to stop the merger, the FTC rejected a settlement under which Staples would sell some $550 million in corporate-contract business to Essendant.

More Resources

• March 2016: Office Depot to Close 50 More Stores in the U.S.
• January 2016: Amazon ‘Dash’ Automatic Toner and Ink Delivery Now Available for Brother Printers
• December 2015: FTC Sues to Block Staples’ Acquisition of Office Depot
• October 2015: Amazon Announces New Toner- and Ink-Cartridge Replacement Service for Brother, Samsung Printers
• March 2014: Staples to Shutter 255 Office-Supply Stores Across North America