Early last month.
NY Times, May 10, 2016 "A federal judge on Tuesday blocked a $6.3 billion proposed merger ofStaples and Office Depot, dashing another huge deal and handing the Obama administration one more antitrust victory.
The decision is a setback for the beleaguered retailers, which have each endured years of slumping sales and increased competition from Amazon and other rivals.
The Federal Trade Commission had sued the two companies late last year, arguing that combining them would effectively create just one dominant retailer focused on pens, paper clips and Post-it notes.
In a three-page order, Judge Emmet G. Sullivan of the Federal District Court for the District of Columbia agreed, writing that the pairing of the two would “substantially impair” competition in the business of selling office supplies."
Not that I think that will happen in this case, although it could. Assuming the to companies come to terms on a buyout price, I think it's more likely that some business units/products of one company or the other will need to be sold off in order to achieve regulatory approval. Just my opinion.
I've often wondered why these situations aren't considered a conflict of interest when you have an individual who is both CEO and Chairman. I get the argument that the more the seller gets for the company the bigger the seller's CEOs payout is, so it's in his interest to get as much as possible. Although I must admit, I don't really know how much incentive the difference between $70M and 90M really is. My issue is with agreeing to the sale in the first place, if the sale doesn't go, no immediate golden parachute, no jump in stock price to make options instantly more valuable....that seems a conflict in terms of what's best for shareholders long term as opposed to a sudden windfall for the CEO/Chairman. I'd be interested in others' thoughts, am I off base here?