Staples, parent company of Top 40 distributor Staples Promotional Products (asi/120601), is attempting to buy competitor Office Depot in a deal valued at $2.1 billion.

It’s the third time that Staples has tried to purchase Office Depot. The most recent attempt occurred in 2016, but the U.S. Federal Trade Commission blocked that $6.3 billion deal, saying the merger could reduce competition for nationwide contracts for office supplies.

Despite that setback five years ago, USR Parent Inc., which is Staples’ U.S. retail business, is again attempting to move forward with a merger.

In an offer announced Monday, January 11, USR Parent Inc. proposes to acquire 100% of the issued and outstanding common stock of The ODP Corporation (ODP), owner of Office Depot, for $40 per share in cash. Staples said that represents a 61% premium over ODP’s average closing price during the immediately preceding 90 trading days.

“Staples believes that its all-cash transaction is a compelling value proposition for ODP’s stockholders that offers a high degree of certainty and is superior to the intrinsic, standalone value of ODP,” the company said in a statement.

In a statement, ODP said it is reviewing the offer.

“As part of its review, the (ODP) board is evaluating various components of the proposal, including potential antitrust and other regulatory challenges given USR Parent’s ownership of Staples and past regulatory decisions blocking the combination of the two companies, purchase price and closing conditionality,” the statement said in part.

Given anti-trust concerns, Staples noted in its statement that the regulatory process for closing the acquisition could take at least six months.

Formerly a publicly traded company, Framingham, MA-headquartered Staples is now private, owned by private equity firm Sycamore Partners, which acquired Staples in 2017. Staples, with this strong financial backing, is determined to bring the ODP acquisition to fruition whether through a negotiated deal or other means.

“We are prepared to cooperate with ODP and its Board of Directors to sign a reasonable negotiated merger agreement,” Staples said in a statement. However, “our intention is to commence a public, all-cash tender offer for 100% of ODP’s outstanding shares of common stock in March 2021 in the event we cannot reach a negotiated agreement with ODP… It is in the best interest of ODP’s stockholders for the Board of Directors to cooperate with the FTC and the Canadian Competition Bureau to have a transaction approved.”

Staples and Office Depot agreed to merge in 1996. A government lawsuit, however, quashed the deal. The successful suit contended that the merger would have meant higher prices for pens, paper and other office supplies.

Matthew Eckhouse, vice president/general manager of Staples Promotional Products and a member of the 2020 Power 50, a definitive ranking of the most influential people in promo, told Counselor that comment couldn’t be provided at this time on what, if any, impacts/opportunities an acquisition of Office Depot could have on Staples’ promo division.

With estimated 2019 North American promotional product revenue of $601.6 million, Staples Promotional Products ranked third on Counselor’s most recent list of the largest distributors in the industry.

Headquartered in Boca Raton, FL, ODP provides business services, products and digital workplace technology solutions through an integrated B2B distribution platform and about 1,200 retail locations. Beyond Office Depot, its brands include OfficeMax, CompuCom and Grand & Toy.