The boards of OfficeMax, with headquarters in Naperville, Ill., and Office Depot, based in Boca Rotan, Fla., both approved the merger unanimously, the competitors said in a release posted on their websites.
OfficeMax stockholders will receive 2.69 Office Depot common shares for each share of OfficeMax common stock.
"In the past decade, with the growth of the Internet, our industry has changed dramatically," Office Depot Chairman Neil Austrian said. "Combining our two companies will enhance our ability to serve customers around the world, offer new opportunities for our employees, make us a more attractive partner to our vendors, and increase stockholder value."
He said the two companies "share a similar vision and culture."
OfficeMax Chief Executive Officer Ravi Saligram said the two companies are "intent on accelerating innovation."
"Together, we will have the opportunity to build on our strong digital platforms and to expand our multichannel capabilities to better serve our customers and to compete more effectively," Saligram said. "Importantly, this merger of equals transaction will provide stockholders of both companies with a compelling opportunity to participate in the long-term upside potential of the combined company."
The merger is expected to deliver $400 million to $600 million in annual cost synergies by the third year, the companies said.
After the merger, the new company's board of directors will include equal representation and governance rights from each party.
A committee will be formed to select the CEO for the combined company, with external candidates to be considered along with the incumbents. Austrian and Saligram will continue in their roles for now.
2014: The Year in Music [PHOTOS]