It's Official: Office Depot, OfficeMax to Join Forces

BOCA RATON, FL-A day after word got out that the two companies were in advanced talks on a merger, Office Depot Inc., based here, and Naperville, IL-based OfficeMax made it official. In a joint statement, the two office products retailers said Wednesday morning that they’d signed a definitive agreement under which the companies would combine in an all-stock merger of equals.

The agreement calls for OfficeMax shareholders to receive 2.69 shares of Office Depot stock for every OfficeMax share they own, a deal valued at about $1.2 billion. The combined company would have had pro forma revenues of $18 billion for the 12 months that ended Dec. 31, 2012, compared to more than $24 billion for Staples, the two chains’ arch-rival. The merger is expected to deliver between $400 million and $600 million in annual cost synergies by the third year following the transaction’s close, according to the release.