Staples and Office Depot: An Event-Probability Case Study

Review of Industrial Organization (2001) 19: 467. DOI: 10.1023/A:1012548125974

22 Pages Posted: 29 Mar 2019

See all articles by Frederick Warren-Boulton

Frederick Warren-Boulton

Ankura Consulting Group (Washington, DC - 200 19th St)

Serdar Dalkir

CRETC Competition & Regulation Economics Testimony and Consulting LLC

Date Written: 1999

Abstract

Investors in financial markets bet their dollars on whether a merger will raise or lower prices. Below, we apply an event-probability methodology to the proposed merger between Staples and Office Depot, which was challenged by the FTC and eventually withdrawn. In addition to a time-series regression, we also look at the effect of the merger in specific event windows. We find highly significant returns to the only rival firm in the relevant market. We estimate the price effect of the merger and find it highly consistent with independent estimates.

Keywords: stock market, event study, horizontal merger, antitrust, price effect

JEL Classification: G14, L41, L81

Suggested Citation

Warren-Boulton, Rick and Dalkir, Serdar, Staples and Office Depot: An Event-Probability Case Study (1999). Review of Industrial Organization (2001) 19: 467. DOI: 10.1023/A:1012548125974, Available at SSRN: https://ssrn.com/abstract=3360008

Rick Warren-Boulton

Ankura Consulting Group (Washington, DC - 200 19th St) ( email )

1200 19th Street
Ste 600
Washington, DC 20036
United States

Serdar Dalkir (Contact Author)

CRETC Competition & Regulation Economics Testimony and Consulting LLC ( email )

DC
United States
202-681-0749 (Phone)

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