Amazon exec weighs in on proposed Staples-Office Depot merger

WASHINGTON An executive with Amazon.com Inc’s (AMZN.O) unit that sells office supplies to companies gave testimony on Tuesday that seemed to reinforce a U.S. regulator’s wariness over a possible merger of Staples Inc (SPLS.O) and Office Depot Inc (ODP.O).

The U.S. Federal Trade Commission filed a suit last year to block the proposed $6.3 billion acquisition of Office Depot by Staples, claiming that it’d damage competition and lead to higher costs for consumers.

A federal judge is considering whether to issue a preliminary injunction to block the price. The choice will depend in part on whether Amazon is perceived as a possible big player at work supply company.

The Amazon executive will be cross examined on Wednesday by attorneys for Staples.

During the 2nd day of a hearing on Tuesday, Prentis Wilson, vice president of the comparatively new Amazon Business unit, testified that his company had no large corporate customers, didn’t stock shelves and generally didn’t bid for a customer’s company.

Wilson’s remarks seemed to support the FTC’s argument the online retailer can barely supply the exact same degree of services as Office Depot and Staples.

Wilson testified that Amazon Company, which started in 2015 as a successor to Amazon Supply, is beginning to react to some demands by corporate customers. It permits purchases to be approved by businesses by their workers. It’s also began allowing businesses to pay an invoice rather than paying for purchases up front.

But Wilson stated that Amazon Company reacted to requests for suggestions, which are basically bids, just in a “small manner.” He said the unit will not create customized indexes for businesses and will not stock shelves for businesses.

“At this stage, Amazon Company will not negotiate contracts with large business customers,” he said.

Inquired if Amazon was the main provider to any business with sales over $250 million, Wilson said, “Not to my knowledge, no.”

In opening arguments on Monday, Staples’ attorney, Diane Sullivan, claimed that her customer dreaded Amazon, which said in 2015 that it intended to join the office supplies market in a serious way.

The hearing is anticipated to survive for up to fourteen days.

About Haider Khan

Founder of HQ Grande Prairie

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