February 11,2019

Staples to Acquire DEX Imaging

martinwolf Transaction Analysis

Financial Information

Transaction Facts

Leading office supply and solutions provider Staples announced today that it acquired Tampa-based office technology provider DEX Imaging.
Transaction details were not disclosed, but DEX is reported to have annual revenues of approximately $250 million (compared with Staples’ $15+ billion). The company specializes in document imaging technology.
DEX President and CEO Dan Doyle, Jr., Chairman Dan Doyle, Sr., as well as the existing executive team will continue to lead the business.

martinwolf Analysis

Casting Nets Wide and Small: Backed by private equity firm Sycamore Partners, Staples also recently announced the acquisition of office products distributor Essendant Inc., a $1 billion deal. That deal was expected to be completed in the fourth quarter, but it was delayed for reasons including needing governmental approval during the shutdown.
Singling Out Services: While Essendant brings Staples enhanced distribution capabilities, DEX and its print management services offer attractive, tightly focused services capabilities to complement its hardware specialization.
Focusing on What Works: Even before its acquisition by Sycamore Partners, Staples has historically used M&A to focus its business on its core offerings. In 2014 it sold its MSP division Thrive Networks to telecom provider MetTel as pressure in the MSP space mounted–martinwolf advised Staples on this sale.
Looking Ahead: The Essendant transaction and the DEX acquisition illustrate two paths forward for large companies in stagnant industries–going big, or going niche. Having the private backing to do both enables a two-pronged approach–and ensures Stables is able to both capture broader market share and become the go-to provider of specialized services.

For more information about this transaction, click here to read the press release.

martinwolf was not the advisor in this transaction.

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