Staples To Shut 60 Stores Across The U.S. And Europe

[Anonymous]

Staples To Shut 60 Stores Across The U.S. And Europe

Staples Inc, the largest U.S. office supplies chain, plans to close 45 locations in Europe and accelerate the closing of 15 stores in the U.S. as part of a plan to save about $250 million a year.

The closings, the impairment of goodwill in the European business and other actions will result in total pretax charges of as much as $1.12 billion, Framingham, Massachusetts-based Staples said today in a statement. The pretax savings will be generated by the end of fiscal 2015, the company said.

Chief Executive Officer Ronald Sargent has posted sales declines in the past two quarters as workers shift to using fewer traditional office products, such as pens and folders. The retailer also has been hurt by slower job creation amid the recession in Europe and high unemployment in the U.S.

Staples fell 0.6 percent to $12.27 at 9:07 a.m. in New York. The shares lost 11 percent this year through yesterday.

The company also said it is pursuing the sale of its European printing systems business and will count the unit as a discontinued operation as of the third quarter.

Staples said it will use the savings from the changes to integrate its Internet and retail offering and increase investment the online operations.
Buyout Interest

Fortune reported earlier this month that private-equity firms have been considering buying the retailer. The talks are preliminary and an offer wouldn’t be made until late this year, the magazine said.

Potential buyers need time to arrange financing and don’t want the public-relations challenges of buying a business associated with Republican presidential nominee Mitt Romney’s Bain Capital LLC, which was an earlier investor in Staples, during the campaign season, Fortune said.

Staples said it plans to return more than $1 billion in cash to shareholders through dividends and share buybacks in its fiscal 2012.

[Author]

September 25, 2012 at 8:13 AM