Office Depot stock touched a 16-month high Monday, but lost those gains after announcing a business networking deal with China e-commerce leader Alibaba (BABA).
Office Depot (ODP) and Alibaba.com will create a co-branded online destination, called Office Depot on Alibaba.com. The idea is to take Office Depot’s 10 million-plus U.S. business customers, and connect them with Alibaba’s network of more than 150,000 global suppliers.
One goal is to make it easier for U.S. businesses to access Alibaba’s large catalog of goods and manufacturing capabilities, the companies said. The site also plans to offer exclusive online and in-store discounts for select products and services from Office Depot. Alibaba and Office Depot intended to expand their offerings for businesses to include logistics and sales channels.
“As a trusted partner to millions of businesses, our customers tell us they want more choice in the market and need an expanded set of products and services to help their businesses grow,” Office Depot Chief Executive Gerry Smith said in a press release. “We believe our collaboration with Alibaba.com is exactly what they are asking for.”
Office Depot stock initially rose 9% but later reversed. The stock closed at 3.49, down 2% on the stock market today. Alibaba stock rose 1.8% to 187.25.
Office Depot also operates about 1,350 Office Depot and OfficeMax retail locations.
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