The two largest office supply retailers, Staples and Office Depot intend to terminate their merger agreement following a ruling by a U.S. district court granting the Federal Trade Commission's (FTC) request for a preliminary injunction to block the transaction. Notwithstanding the FTC's specific concerns, we think the sector continues to face a secular decline from use of technology as well as sharp competition from both e-commerce and other large traditional retailers. We are affirming all ratings on the company, including the 'B-' corporate credit rating and removing them from CreditWatch with positive implications. The outlook is stable, which incorporates our view that despite the challenging operating environment that hurts performance, we expect Office Depot to continue smoothly integrating Office Max,
