Essendant supplies smaller regional office supply companies. As their prices are raised, Essendant makes more and these independents make less. Staples can then purchase for pennies on the dollar. Increasing market share and profit margins to fight off Amazon.
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WB Mason is a sinking ship. Sales are down, prices are high, delivery s—s!! Company can’t pay there bills. The owners are taking every cent out of the company before they sell. Tell me how WB Mason is doing well.
essendant owns a lot of other little businesses. ors nassco and medco have already been "carved out" they will be completely divested within 18 mos . it was paid for by another equity company. this is how essendant is providing value to sycamore. they will split out all the companies essendant owns and sell them off one by one leaving essendant an empty shell of low value office products which will inevitably lead them to A.backruptcy. or B.being consumed completely by staples (or amazon?)(or mason?!)
essendant has little value but what they own has potential but you're right about mngmnt and that is why they had a stock value of $7 a share before sycamore got into the game. they don't know how to manage at any level!!! they didn't know what to do with what they had and now it belongs to sycamore
as for mason ….they are more likely to buy off some of essendant than sell themselves to staples ...at any price. they really really hate staples! and besides they seem to be doing pretty well right now! why sell when you've got everyone begging for your business. they're in the sweet spot!
Clearly some people who don’t work in the industry don’t understand what’s going on. Amazon is going to put everyone out of business if Staples and the independent dealers join forces!! That’s a fact.
That’s nonsense. Take a look at how Staples and Essendant are managed - as separate businesses. As required by law. The value gain is minimal.
And while everything has a price, WB Mason won’t readily sell to Staples. They’re more likely to sell to OD, given the anti-trust position in the NE.
It was a strategic acquisition to purchase small independent dealers which Staples has successfully done. The big reason was to purchase WB Mason which should be completed by the end of the year.
It was a mistake. SP thought that it would pass anti-trust and that Staples could use it to control more of the market through wholesale operations, and boost pricing. It didn’t pass, surprisingly. So it is managed at arms length, and will be sold ASAP, as it no longer has strategic value.