The First Look - Michael Regan, Bloomberg News
Feb 20, 2013|
The First Look - Michael Regan, Bloomberg News
Transcript - Not for consumer use. Robot overlords only. Will not be accurate.
Michael Reagan from Bloomberg News joins -- good morning Michael -- Good -- on how old this merger between Office Depot and office Max impact staples. Well the you know it's funny you -- actually sort of breaking news a member here at the moment it it turns out. The company -- people issued a press release announcing the merger all the terms and it. It's it's remove that press release from the web site the New York Times is reporting that. Press release was issued. The prematurely -- the deal isn't finished yet that bankers and and the company's stock initiate the terms well. Think that it's so -- -- -- -- right now trying to you know figure out exactly what happened but -- Presumably you know there was a deal on the table and it's it's you know it is that there's -- a petite gals now. But so we we hear otherwise and yet looking at staples are actually you know. They actually -- people's point of being the winner out of this deal the main reasons because after the merger. Office Depot office -- will likely. The close hundreds of its worsening. That's part of the real rationale behind -- is that it's shrinking industry. There's no need these hundreds of office supplies were so. It in what analysts but to Credit Suisse believes -- the closed up as many 600 stores. Which could provide a pretty good opportunity for staples companies and you know gains market share. Were in any of their locations -- -- as close to herself. You know staples got to -- -- the -- yesterday partly because of that partly because you know it he just feels like the equal amid a deal machine is sort of firing on all cylinders right now and and and make he'd eat next so. -- staples is looking like actually opener because whispered. If it is winner. In but it it's infected dying industry because you walk into a staples store today. They're not terribly busy we have one right around the corner from the office. And you know our office manager here never goes to the store but they get a lot of deliveries I see the staple struck out front all the time. It is there still room for money to be made in this stock or is it petered out as -- -- a -- -- their 13% pop -- that's it. Well it it luckiest said it is it's there it's. -- -- That's shrinking industry office -- Office Depot is neither one of them has had a full year of revenue -- since about 2000. Staples has been able. Eke out sort of single digit -- two percentage point revenue group the last few years. But yet that's between this year. Sure that it took them to Lendl all have negative -- group. So it. It's that clean you know it's not a growth industry at all you know those delivery truck should mention -- you know sort of -- it. Unseen element in the steal at least a is that contracts services -- supplying large paper. Printer cartridges. -- Machine park that marks. That that's where the real profit margins are you know he's he's retail location. Are sort of an afterthought and really kind of kind of so round that he's -- that's at the moment so. You know it -- because it is just not there you know basically Office Depot and office expert. You know and -- -- -- stores yet they're basically all fighting over shrinking pie at this point so it's it's it's about. What about they believe an upstart company appear New England WB Mason as a matter of fact I think they've started getting into the New York market is there room for another wonder is WB Mason. You know too late to the party. Well it it's it's a -- parliament upstart you know they that that he's been around for about 415 years. That you know there are very. You know focused northeast. Accompanied. They're really focused on the but it was real name -- had something like 400. Some trucks compared to about forty. -- actual work locations. So they're really concentrating on that would bring products to -- boxes on recurring basis you know your paper based office supplies. Yeah it -- that they are operating in your -- I've always been fascinated by a Boston based company would have a billboard at Yankee Stadium yeah. And so proud but surprised that -- can -- -- right up there and we we're not too thrilled about it yeah and I kept -- In that tablet shape. I guess they're you know he he got Egypt -- -- -- than the other but. Yet you know that there're -- well we minor player that would mean they're they're doing something about the to be around for 400 years. They're very popular appear in annual auto companies do we we do business with them. Right right bullet you know at that and hips -- that long must we don't have the right and and maybe -- the key is that they're not trying to expand nationally. Too fast in other particulates. You know. It's succeeding in the markets where where they tenure as a as super private company. It's really hard to know how well we're going -- and really look at their their credentials but. As a whole the missiles this whole office -- supplies basic shrinking it from the retail levels especially I mean obviously you know. They're getting hit a circle 12 punch from the Internet you know people are putting a lot less so -- they're buying a lot less paper. And any off supplies they are buying you know there -- also you know their job and looking at the web rate set at Amazon and what not so it's. It's it's really the sort of the dying we challenge. Very get a Michael thanks for your time. Michael Reagan Bloomberg News. In in a paper paper you're gonna buy paper I know the gals out in the office they just they -- shop around wording of the best prices for the by by. He see him coming in with cases which are now legal for pressure pretty rapid. 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