Amazon May Be Working On A Deal With Office Depot

However, earlier in the month, news began to circulate that the U.S. Federal Trade Commission was seeking to obstruct the deal. Despite the merger's approval (with concessions), the FTC's complaints highlighted a potential monopoly situation where the proposed merger would both stifle competition and raise customer prices. The suit began in December, with ruling to begin in March and a ruling due May 10.

Staples has publicized that an alternative is being developed, as this marks the second time the FTC has stepped in between Staples and Office Depot on M&A talks.

Related Link: Here's What Office Depot Said On It's Pending Acquisition By Staples In Its Q4 Report

Amazon Joins The Conversation

With the Staples-Office Depot merger at risk, another investor has taken notice – an activist investor with a stake in Office Depot. According to the New York Post, Amazon.com, Inc. AMZN may be eyeing Office Depot as part of its ongoing expansion of the Amazon Business footprint.

"The deal would involve Amazon, which is believed to be eyeing the corporate business unit of Office Depot, according to a person familiar with the investor's thinking," said the Post. With the Street having assumed Amazon was interested in expanding that subsector for quite some time, the news is hardly surprising. "While no decision has yet been made about whether Jeff Bezo's $272 billion market-cap company will ink a deal, there has been talk on Wall Street that the chief executive was looking to expand," the Post surmised.

Interestingly, while the Staples-Office Depot conglomerate has been speculated to control more than 70 percent of the office supplies market, the Post calculated that an Amazon-Office Depot plan "would create a stronger No. 2 player in the sector." This stronger player would then, theoretically, "help Staples get the FTC to reverse its decision to block the $6 billion deal," the Post cited a source familiar with the matter as having said.