Amazon's (AMZN) New Business Initiative Could Help Staples, Office Depot Merger - Janney (SPLS) (ODP)

Janney Montgomery Scott is getting a little more favorable on Staples (Nasdaq: SPLS) and Office Depot (Nasdaq: ODP) eventually merging following a new bit issued earlier Tuesday.

Amazon.com (NASDAQ: AMZN) announced the launch of Amazon Business, "a new marketplace on Amazon.com that combines the selection, convenience and value customers have come to know and love from Amazon, with new features and unique benefits tailored to businesses," according to the company.

Analyst David Strasser commented, This Amazon.com strategy will continue to pressure SPLS and ODP as this new and ferocious competitor emerges. However, the announcement this AM, perversely is a positive for SPLS and ODP as it provides competitive evidence in support of the SPLS/ODP merger. The key risk is that FTC might not okay the merger or put tough conditions, but this competitive intrusion defends the SPLS/ODP position. Fears of the FTC are inherent in ODP shares trading at over 15% discount to the deal price of $11.

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