Well, that was fast. Just a day after news broke that Office Depot was in the process of making an offer for rival OfficeMax, The New York Post reports the two retailers agreed to a merger.
The transaction is valued at roughly $1.2 billion.
The article points out, however:
Analysts say that if the deal closes it would likely benefit the largest office supply player Staples Inc. since the combined entity will likely close stores.
"We think a potential merger would result in a significant number of store closings, and thus an improvement in the overall economics of the office supply retail business," said S&P analyst Ian Gordon on Tuesday. "This area has been under pressure from a weak business spending environment and competition from non-traditional channels like Amazon in our view."