Staples Inc. (SPLS), the global leader in the supply of office products, recently announced the acquisition of Oy Lindell Ab – one of the leading office supply companies in Finland. With this move, Staples aims to boost its business in the Nordic region.
 
This transaction becomes part of the company’s $3.5 billion office products business in Europe. The terms of the deal were not disclosed.
 
Lindell, which operates a central warehouse, seven company-owned stores and two franchised stores in Finland, offers a range of office products, industrial and school supplies. The transaction will not only enhance Lindell’s service and product offerings, but will further help consolidate its operations. Bo Nyman will retain its CEO position in Lindell.
 
Staples also informed that it previously had an agreement with Lindell to provide services to global contract customers in Finland. This was a carryover from its acquisition of the office supply chain, Corporate Express, in 2008.
 
Being a leading retailer of office products and services, Staples is better positioned than its competitors to benefit from the economic recovery, and is poised to sustain its growth momentum based on its margin expansion, effective merchandising, and growth prospects across its retail, delivery and international divisions.
 
However, the intense competition from other office supply retailers, sluggish demand for big-ticket items and foreign currency fluctuation still remain concerns.
 
Consequently, we prefer to be Neutral on Staples. Moreover, our Zacks #3 Rank, which translates into a short-term ‘Hold’ rating, correlates with our long-term recommendation.
 
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