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The Wall Street Journal reports that Staples management is trying to figure out "plan B" - or what it is going to do if the US regulators reject its bid to acquire Office Depot.

CEO Ron Sargent told analysts last week that "the office-supplies retailer is planning specific changes to improve its stand-alone performance 'despite the fact that we’re focusing all our energies and efforts on getting this acquisition behind us'."

The Journal story notes that "Staples has struggled with years of declining revenue as demand wanes for traditional office basics like folders and filing cabinets and as shoppers seek cheaper deals online. Managers last year pinned their hopes for a turnaround on a $6.3 billion combination with Office Depot designed to save on the operating costs from stores, distribution centers and executive offices." And things don't seem to be getting better - Q4 North American sales were down five percent.
KC's View:
First of all, I continue to believe that federal regulators need to change their definition of competition to factor in the digital realm. Combining Staples and Office Depot may eliminate some Main Street competition, but there remains plenty of it out there. And while corporations and governments tend to have contracts with companies like Staples, I can't see any reason they can't do business with Amazon or their online brethren. It wouldn't even take all that much imagination ... just a little bit of flexibility.