Office Depot Inc. (NYSE:ODP) said Wednesday that it will buy OfficeMax Inc. (NYSE:OMX) in an all-stock deal that values OfficeMax at about $1.19 billion.

Office Depot will issue 2.69 shares for each share of OfficeMax, which translates into a per-share value for OfficeMax of about $13.50, a 3.8 percent premium above the share's closing price on Tuesday.

Once the merger is complete, the resulting company will have revenue of nearly $18 billion, which will make it better able to compete with rival Staples, Inc. (Nasdaq:SPLS), according to Bloomberg News.

Office Depot and OfficeMax will have an equal number of seats on the board of the combined company.