Staples, Inc. has reached a deal to unload its European business to the private equity firm Cerberus Capital Management, as part of a strategy to return its focus to North America following a failed mega-merger.
Cerberus will take a controlling stake in the European operations, paying 50 million euros, or about $53.7 million, for the shares. However, Staples will transfer an estimated $171.5 million to the company after the deal closes to cover debts, pension liabilities, and other costs. Staples will keep a 15 percent stake in the Europe business.
The move comes seven months after a federal judge effectively killed a planned merger between Framingham-based Staples and rival Office Depot.
When the deal fell through in May, Staples said it would explore alternatives for its European businesses and prioritize North America, where it has closed hundreds of stores in recent years amid changing consumer habits and the rise of online shopping.
“One of our top strategic priorities has been to narrow our geographic focus on North America, and this is an important step toward simplifying our operations and better positioning Staples for sustainable long-term growth,” Staples chief executive Shira Goodman said in a statement.
Office Depot in September announced it had reached a deal to sell its European business.
Staples’ European operations include retail stores, online shopping, and business services in 16 countries with annual sales of about $1.8 billion, according to the company.
The sale does not include Staples’s business in the United Kingdom; the company agreed last month to sell that unit to London-based Hilco Capital.
In the UK, the Staples brand will be phased out, the retailer said in November. But the name will live on in the rest of the continent, as the deal with Cerberus calls for a licensing agreement that will include the use of Staples branding.
Staples expects the deal to close in early 2017.