Sycamore Completes Essendant Acquisition

Sycamore Completes Essendant Acquisition

(JANUARY 31, 2019) - Staples Inc has confirmed that an affiliate of its owner Sycamore Partners has completed the acquisition of North American office products wholesaler Essendant.

The confirmation comes just 48 hours after the Federal Trade Commission (FTC) approved the transaction – albeit with conditions – and less than 24 hours after Staples completed its tender offer for the outstanding shares of Essendant.

When the tender offer closed yesterday evening, the number of shares validly tendered, along with the 11% already owned by Staples, represented almost 80% of Essendant’s common stock.

A number of other customary closing conditions had to be finalised, although OPI understands these were not related to any outstanding shareholder legal challenges to the acquisition.

Essendant will now delist from the NASDAQ stock exchange, and the wholesaler has already filed a deregistration document with the US Securities and Exchange Commission.

In a press release, Staples said that it would work together with Essendant “to give reseller customers access to an expanded product assortment, innovative technology and world-class supply chain capabilities and support”.

Essendant and Staples’ sales teams will continue to operate separately, it was confirmed, although this is a requirement of the FTC’s ‘firewall’ conditions.

“Staples views the reseller community as partners in serving customers that will allow us all to be successful,” said Staples Inc CEO Sandy Douglas.

“We value the relationships the resellers have built with Essendant and look forward to helping them build on their already impressive success. We’ve created a strong, externally monitored firewall to protect resellers’ confidential information, as required by the FTC, and also as a sign of trust, because we know it’s the best thing for the Essendant business, and the resellers.”

As part of the transition, Ric Phillips, President and CEO of Essendant, has announced his intention to seek opportunities outside the company. Harry Dochelli, meanwhile, who has been with Essendant for the past six years, most recently in the role of President of Office and Facilities, has been named President and will lead the organization.

“Essendant has been a key partner to the reseller community for almost a century, and we see that relationship only strengthening by working with Staples,” said Dochelli. “Essendant brings a unique value proposition to its reseller partners, and with Staples will now have enhanced capabilities to provide to our customers, enabling them to win in the marketplace.” (OPI)