Boca Raton, Fla. — The merger agreement between Staples, Inc. and Office Depot, Inc. has been terminated. As a result, Office Depot will receive a cash payment from Staples of $250 million on May 19, 2016.
The news comes after Office Depot and Staples had recently agreed to extend their merger agreement termination date from February 4, 2016 to May 16, 2016. Staples had begun discussions to acquire Office Depot in September 2014. Read more here.
Simultaneously, Office Depot has successfully extended its asset-based credit facility for an additional 5 years. The new $1.2 billion facility will mature on May 13, 2021. The amended credit agreement reduces the overall fees and applicable spread on borrowing and modifies certain covenants to provide additional flexibility for incremental indebtedness, acquisitions, asset sales and restricted payments.
“The continued realization of synergies from the merger with OfficeMax has provided the company with a significantly improved financial profile including a strong liquidity position and the ability to generate future cash flow as merger related expenditures abate over time,” says Roland Smith, Office Depot chairman and CEO. “The extension of our credit facility provides us with substantial flexibility as we look to enhance shareholder value going forward.”
Office Depot, Inc. has annual sales of approximately $14 billion and has approximately 1,800 retail stores. The company operates under several banner brands including Office Depot, OfficeMax, Grand & Toy and Viking. Additional press information can be found at http://news.officedepot.com.
SOURCE: Office Depot, Inc.