Shares of Staples, Inc. (NASDAQ: SPLS) were trading lower by more than 16 percent early Wednesday morning, while shares of Office Depot Inc (NASDAQ: ODP) plunged more than 35 percent after the companies called off their proposed merger.

Staples said in its press release the decision to terminate the proposed merger follows the recent ruling of a U.S. District Court of Columbia which granted the Federal Trade Commission's request for a preliminary injunction to block its acquisition of Office Depot.

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As part of the merger agreements, Staples will pay Office Depot a one-time break-up fee of $250 million. In addition, Staples will no longer proceed with its planned divestment of large corporate contract businesses and related assets to Essendant.

He concluded, "We are positioning Staples for the future by reshaping our business, while increasing our focus on mid-market customers in North America and categories beyond office supplies."