"FTC moves to block Staples-Office Depot merger" by Beth Healy and Hiawatha Bray Globe Staff December 07, 2015
The federal government on Monday moved to block a mega-merger by Staples Inc., the Framingham-based office supply chain, and its chief competitor, Office Depot Inc.
It was the second such move in two decades against the companies, which are now fighting to survive in an increasingly online sales arena.
Right. The collapsing economy built on a perpetual $y$tem of increasing wealth inequality is excused by the invisible online sales.
We are talking the two biggest office supply corporations; if they fighting to survive and aren't thriving during this alleged recovery then there has never really been one.
Staples in February had announced a $6.3 billion acquisition of Office Depot, of Boca Raton, Fla. But regulators at the US Federal Trade Commission on Monday filed a legal action to kill the deal, saying it would lead to higher prices for office supplies, particularly for business customers, where the merged company would have a dominant 70 percent share of the market.
“The Commission has reason to believe that the proposed merger between Staples and Office Depot is likely to eliminate beneficial competition that large companies rely on to reduce the costs of office supplies,” FTC chairwoman Edith Ramirez said in a statement. The agency in its complaint said the merger would end the “intense head-to-head price competition” that exists between the two top players.
At his point in governance of, by, and for corporations, does it really matter what handful of conglomerates you get to pick from (after all the price collusion)?
The FTC’s action is a particular blow to Staples, a storied local company founded in 1986 by the late businessman Thomas Stemberg, with venture capital backing by Bain Capital’s Mitt Romney, who went on to be governor of Massachusetts and a two-time presidential candidate. The company at its height employed 91,000 people. Today it says it has 1,900 stores and 79,000 employees.
Both companies said they plan to contest the agency’s action, but Boston College law professor Brian Quinn, a specialist in mergers and acquisitions, said it is unlikely that Staples will keep fighting.
“It could take years to litigate this,’’ Quinn said. “They have too many other things they can do with their money. Markets are moving too quickly for them to stay in place.”
Staples had offered to give up more than $500 million in business with commercial customers to an established competitor, much the way national banks in the past have sold off branches in major deals, to satisfy antitrust concerns. The FTC rejected that proposal, saying the merged company would still be without competition powerful enough to force it to compete on prices.
“What the FTC is saying is the other players in the market don’t have that degree of sophistication,” said David Marcotte, senior vice president of retail insights at Kantar Retail in Boston, a research firm.
Far from simply delivering cartons of copier paper and file folders, Staples and Office Depot become intimately involved with their customers’ businesses, helping them efficiently manage their office supply budgets, Marcotte said.
The Canadian government’s Competition Bureau also moved Monday to block the merger in that country. In the United States, the FTC will now ask a federal judge to halt the merger. An administrative trial is scheduled to begin May 10, 2016.
In 1997, a federal judge also blocked a deal between Staples and Office Depot, on the FTC’s objections. However, in 2013 the FTC allowed a $1.2 billion merger of Office Depot and OfficeMax Inc., the No. 2 and No. 3 sellers of office supplies.
Since then, Staples and Office Depot have reported declining revenues, amid a rapidly changing retail environment that favors online sales, and responded by closing hundreds of stores and cutting staff. Staples’ revenue last year was down 3 percent, to $22.5 billion. Net income declined to $135 million, from $620 million for continuing operations in 2013.
Declining revenues, huh?
Together, the companies contend, they would be stronger and would lower costs for consumers and businesses.
And consolidation is the last phase before the death throe.
Staples has so far been able to “financially manage against reality,” Marcotte said. “The market is shrinking, but they’re still profitable.”
What I have I (and others) been saying for months and months as the government and pre$$ spew lies?
Competition includes manufacturers selling directly to businesses, as well as companies like Amazon.com and Walmart that are popular with consumers....
There was a herd at Amazon, but I didn't see anyone at Walmart.
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Related: As Office Depot merger falters, Staples’ next step won’t be easy
They are now threatening to move to Cuba because of the government action.
"GE scraps $3.3 billion sale of appliances division to Electrolux" by Chad Bray New York Times December 07, 2015
LONDON — General Electric has called off a deal to sell its century-old appliance division to Electrolux of Sweden for $3.3 billion all-cash deal after the US Justice Department moved to block the transaction, Electrolux said Monday.
“We disagree with the Department of Justice’s narrow view on a transaction that would have benefitted consumers,” General Electric said Monday. “The appliances market is dynamic and highly competitive.”
The unit in question, GE Appliances, based in Louisville, Ken., derives more than 90 percent of its revenue from North America. Its products include refrigerators, dishwashers, air conditioners, washing machines, dryers, and water heaters. The division employs 12,000 people....
Related: GE Puts Good Things to Death
Which is what I'm going to do to the rest of the article.
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Also see: Railroad merger bid rejected again
NDUs:
Dow Chemical, DuPont said to talk merger
Dow Chemical, DuPont said to be near merger
And the business climate in Cuba?
"Warming US relations stir enthusiasm, fear in Cuba" by Andrea Rodriguez Associated Press December 10, 2015
HAVANA — A surge in Cubans seeking to leave the island before their preferential status for US residency ends has flooded Central America with migrants in what could be the biggest exodus since the 1980 Mariel boatlift.
In the year since Presidents Raul Castro and Obama announced a rapprochement between the bitter Cold War enemies, Cuba has been transformed, for better or worse. A country that once seemed stuck in time suddenly faces an uncertain future of disruptive change.
Particularly for those with money, property or connections, the frothy optimism is palpable, as are the expectations of greater prosperity and new freedoms.
For others — the poor, the old, the vast ranks of bureaucrats who’ve dedicated their lives to the communist system, the dramatic dual presidential announcements of Dec. 17, 2014, and the steps toward normalization have led to feelings of fear.
Cubans with businesses have been buoyed since then by the prospect of better relations. Hotels, private bed-and-breakfasts, and elegant restaurants have been packed, with hundreds more expected to open in the coming year.
Pope Francis, who played a critical role in negotiations that led to detente, made a stop in Cuba on his way to the United States in September. US Secretary of State John Kerry reopened the embassy in person in August.
They are both part of the problem.
‘‘It’s a breath of fresh air, knowing that they’re filing away the rough edges between the two peoples and their governments, and that can open a path to a future of brotherhood and mutual aid,’’ said Fernando Funes, a former government agronomist who runs a 20-acre environmentally friendly farm supplying vegetables such as arugula and chicory to private restaurants in Havana.
That is what it is all about.
Those in favor of the warming in relations are hoping that the anniversary of the presidential announcements will add momentum to negotiations to connect the countries with commercial flights and direct mail, perhaps paving the way for a visit by Obama in the first half of next year.
But for others, the changes are happening much too fast.
Many fear normalization will end the guarantee of legal residency that Cubans receive the moment they touch US soil. Roughly 45,000 Cubans are expected to travel by bus, boat, taxi, and on foot from Ecuador and other South and Central American countries to the Texas and California borders with Mexico this year. With thousands more sailing across the Florida Straits, 2015 may witness the biggest outflow of Cubans since 125,000 fled during Mariel.
Another refugee crisis the Globe has been silent about.
Related: Puerto Rico’s governor warns of likely default on debt
The exodus has prompted a crackdown by Cuba and its regional allies, with Nicaragua closing its border to Cubans last month, and Ecuador suddenly requiring Cubans to get a visa.
Cuba declared Dec. 1 that its medical system was in a critical situation because of a US program that offers special treatment for doctors who want to emigrate.
Physicians would now need exit permits to leave the country for any reason. It was a dramatic reversal for a government that two years ago eliminated the permits Cubans once needed to leave their own country....
Still stuck, huh?
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