What happened
Shares of Staples Inc (SPLS) were surging on Thursday after reports emerged that the office-supply retailer was in advanced talks to sell itself for at least $6 billion.
As of 1:02 p.m. EDT, the stock was up 7.2%.
Image source: Staples.
So what
Staples had said earlier in the year that it was looking at "strategic options" following the collapse of its merger with Office Depot so the news is not a total surprise.
Last night, Reuters reported that private equity firm Sycamore Partners was close to closing deal for Staples that could value the retailer above $6 billion. Staples market cap reached $6.06 billion on the news.
Reuters sources said Sycamore beat out Cerberus Capital Management for the takeover.
Now what
While Staples' retail segment has struggled along with the rest of office supply retail, which has seen sales crumble amid the rise of digital solutions, its commercial division, which supplies directly, remains strong. The company is still profitable, and a private equity firm likely sees value in the commercial side while cutting costs and closing stores in the retail chain.
Sycamore holds investments in several other retail brands including Dollar Express, Hot Topic, The Limited, and Talbots.
With the talks already at an advanced stage, confirmation of a deal could emerge within weeks or even days.
