EU Probes Staples' Planned Purchase of Office Depot

European Union regulators have opened a detailed investigation into Staples' $6.3 billion planned acquisition of Office Depot, warning the deal could lead to price increases and less choice for business customers. The deal, announced in February, would take the U.S. down to one chain of office-supply superstores from three in just a couple of years, after U.S. regulators approved Office Depot's acquisition of OfficeMax in 2013. In Europe, EU regulators said Friday that their preliminary investigation had indicated competition might be harmed in the market for the supply of office products to business customers. Staples and Office Depot, together with their largest European competitor Lyreco, are the main suppliers of office products to business customers, the regulators said. "The transaction could eliminate an important competitor and reduce the choice of suitable suppliers in already concentrated markets, which could lead to price increases," the EU said. It also pointed to possible competition concerns regarding the wholesale of office products in Sweden, "where the merging parties appear to have no significant competitors offering a wide portfolio of products." "All companies and organizations, big or small, need office supplies for their daily work," the EU's antitrust chief, Margrethe Vestager, said in a statement. "We are opening this in-depth investigation to make sure that the merger of two of the main suppliers of office products will not have a negative effect on competition." Staples Chief Executive Ron Sargent said in August that he still expects the deal to close by year-end despite recent opposition from U.S. regulators to consolidation in other industries. Write to Tom Fairless at tom.fairless@wsj.com