Staples to sell off European stores, focus on North America

Staples (NASDAQ:SPLS) announced this week it would focus its efforts on stores in North America as the company lays out plans after its failed $6.3 billion merger with Office Depot (NASDAQ:ODP).

The office supply company reported its smallest sales decline in six quarters, reported Boston Herald. Sales were down 3.1 percent to $5.1 billion and net income dropped 31 percent to $41 million, due to restructuring and store closures.

CEO Ron Sargent is planning to meet with potential buyers for its European business. Then the company will focus on increasing its North American sales from 85 percent to 95 percent of the company's total sales.

Also part of the plan, moving forward, is to focus on mid-market businesses with 10 to 200 employees, by adding sales reps to focus on these business-to-business transactions.

The initiatives were laid out as part of a larger plan earlier this week, after a federal judge allowed the Federal Trade Commission to block the merger on grounds it would harm large business customers. Under terms of the agreement, Staples will pay Office Depot a $250 million break-up fee.

Other initiatives include $300 million in cost reductions by the end of 2018 and the closure of at least 50 locations in 2016.

"We are confident that by narrowing our focus … we can get back to sustainable long-term sales and earnings growth," Sargent told Boston Herald.

For more:
- see this Boston Herald article