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Office supplies retailer Staples explores sale sources


´╗┐Staples Inc (SPLS. O) is in talks with private equity firms about a potential sale, sources familiar with the matter said on Tuesday, as the largest U.S. office-supplies seller tests buyer appetite for an industry rattled by online competition and hefty debt burdens. A sale to an investment firm could help Staples escape the glare of the public market, where its shares have more than halved in three years. The move comes less than a year after its proposed merger with rival retailer Office Depot Inc (ODP. O) was torpedoed on antitrust grounds. The sources spoke on condition of anonymity because the process is confidential. Staples spokesman Mark Cautela declined to comment on Tuesday. Framingham, Massachusetts-based Staples had a market value of $5.65 billion as of Monday. Staples shares rose as much as 15.5 percent on Tuesday, and were still up 10.1 percent at $9.54 in afternoon trading. Staples, which made its name selling papers and pens, has for years been hurt by the digitization of the workplace and increased competition from online retailers including Amazon.com Inc (AMZN. O) and big-box stores such as Costco Wholesale Corp (COST. O) and Wal-Mart Stores Inc (WMT). In 2015, it tried to address these challenges by merging with rival Office Depot, but the deal was called off a year later due to antitrust concerns.

Since then, Staples has announced cost-cutting plans and operational restructuring. Last year, it sold its UK business to restructuring specialist Hilco Capital for a "nominal" amount and a majority stake of its European business to private equity firm Cerberus Capital Management LP. In the United States, it has focused on selling to small businesses in light of changing consumer habits and has embarked on an office sharing program, opening up some of its stores as communal working space. Staples, which has 1,255 stores in the United States and 304 in Canada, last month announced plans to sell roughly 60 stores in North America.

Staples has made executive changes as well, appointing Shira Goodman as CEO in September. Goodman, who had held a number of positions as Staples, also worked for years as a consultant at consulting firm Bain and Co. Private equity firm Bain Capital LLC helped support the founding of Staples in the 1980s and took it public in 1989. Staples has the largest market share of office supply stores in the United States at 48 percent and that share has been increasing since 2011, according to Euromonitor. TROUBLED SECTOR Private-equity acquisitions of retailers have become increasingly rare, as the investment firms worry about increasing headwinds facing the industry and their portfolio companies struggle with the debt burden left behind from leveraged buyouts. Retail deals comprised the smallest share of mergers and acquisitions in the first quarter of the year, according to Thomson Reuters data.

Peabody makes fresh U.S. stock debut after bankruptcy exit CHICAGO U.S. coal miner Peabody Energy Corp returned to the New York Stock Exchange on Tuesday after emerging from a year-long $8 billion Chapter 11 bankruptcy with far less debt and an industry champion in the White House.

Vale megadeal puts Morgan Stanley, Bradesco at the top of Brazil M&A SAO PAULO Morgan Stanley and Banco Bradesco BBI SA topped Brazil's mergers and acquisitions rankings in the first quarter, buoyed by advisory roles in the $21 billion corporate reorganization of Vale SA , the world's No.1 iron ore producer.

Allianz-led consortium wants 5 percent of Atlantia motorway unit: sources FRANKFURT/MILAN A consortium led by a unit of Allianz is looking to buy a third of the 15 percent stake Atlantia is selling in its Italian motorway business, two sources close to the matter said on Tuesday.

Stocks start second quarter on firm note, U.S. policy in focus as Trump Xi...


´╗┐Asian shares started the week modestly higher on Monday after a bumper quarter as investors look to the shape of U.S. trade and economic policies and how they could affect global growth. MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.3 percent, while Japan's Nikkei gained 0.4 percent after hitting a seven-week low on Friday. Ex-Japan Asia MSCI had gained 12.3 percent in the last quarter, its biggest quarterly gain in 6-1/2 years and almost double the 6.4 percent rise in MSCI's broadest gauge of the world's stock markets covering 46 markets. The rally was primarily underpinned by signs of a pickup in momentum in the global economy, led by China. South Korea's trade data for March released over the weekend added to the evidence of improving global demand, with exports rising more than expected. While a private survey on China's manufacturing on Saturday came in below market expectations it still showed a healthy expansion after a similar survey by the government on Friday pointed to strong growth in the sector."The Chinese economy is likely to stay firm at least until the Communist party congress (later this year). The hi-tech sector is doing well, supporting Korean and Taiwanese shares," said Yukino Yamada, senior strategist at Daiwa Securities. In Japan, the Bank of Japan's tankan survey showed that business sentiment improved, albeit slightly less than expected.

The main focus for markets this week centers on U.S. payroll figures on Friday and U.S. President Donald Trump's first meeting with counterpart Xi Jinping on Thursday and Friday."If we get strong reading in U. S payrolls data, the markets will try to price in a rate hike in June," said Minori Uchida, chief currency strategist at the Bank of Tokyo-Mitsubishi UFJ. Markets are currently pricing in around a 58 percent chance of another rate rise in June, which would mark the second of three hikes expected this year. On the other hand, investors are on guard for the possibility the U.S. administration may adopt protectionist measures. In a tweet on Thursday, Trump said he expected the meeting with Xi "will be a very difficult one."

On Friday, Donald Trump sought to push his crusade for fair trade and more manufacturing jobs back to the top of his agenda by ordering a study into the causes of U.S. trade deficits and a clampdown on import duty evasion. And on Sunday, Trump held out the possibility of using trade as a lever to secure Chinese cooperation against North Korea. The executive orders came a week after Trump's promise to replace Obamacare imploded in Congress, adding to concerns he may struggle to pass highly-anticipated tax cuts and infrastructure spending bills."After his failure to push through his healthcare reforms, investors increasingly think that his tax reforms will take time. And given the China-U.S. summit, trade issues could come to the fore this week," said Masahiro Ichikawa, senior strategist at Mitsui Sumitomo Asset Management.

Any hints that Washington may name some of its trade partners such as China, Japan and Germany, as currency manipulators could dent the dollar. The U.S. Treasury will release its next currency report on April 15."The Trump administration is not necessarily seeking to reduce the trade deficit through a cheaper dollar. But it has strong intentions to do that and it could use a weaker dollar as a bargaining tool in trade negotiation," said Uchida of the Bank of Tokyo-Mitsubishi UFJ. The dollar was slightly softer at 111.33 yen, but kept some distance from its four-month low of 110.11 touched a week ago. The euro ticked up 0.2 percent to $1.0673, rebounding from Friday's two-week low of $1.0651 hit after data had shown inflation in the currency bloc had slowed by far more than expected in March. Oil prices stood near three-week highs on a growing sense that OPEC and nonmember Russia would extend their production cut, seeking to drive the market higher, though high U.S. rig count capped their advance. Brent crude futures hit a three-week high of $53.63 per barrel early on Monday and last stood at $53.43, down 0.2 percent from U.S. close. U.S. West Texas Intermediate crude futures was little changed at $50.56 a barrel.