Dollar General outbid Dollar Tree for Family Dollar

Dollar General has made a proposal to acquire Family Dollar Stores Inc. for $78.50 per share in cash, in a transaction valued at $9.7 billion.

The all-cash proposal was conveyed this morning in a letter to Family Dollar’s board of directors.

The combination of the two chains would establish Dollar General as the largest small-box discount retailer in the United States, with nearly 20,000 stores in 46 states and sales of over $28 billion.

“For Family Dollar shareholders, our proposal is financially superior to the current transaction agreement with Dollar Tree and would provide Family Dollar shareholders with a substantial premium and immediate liquidity for their shares,” said Rick Dreiling, Dollar General’s chairman and CEO.

“We look forward to expeditiously entering into constructive discussions with Family Dollar in order to sign a definitive merger agreement that provides enhanced value to Family Dollar shareholders and enables Dollar General to realize the benefits of this combination.”

Dollar General is prepared to enter into a definitive merger agreement that would be substantially similar to the one entered into between Dollar Tree and Family Dollar, modified as necessary to accommodate Dollar General’s all-cash proposal, the antitrust matters described above and to provide a time period to close the proposed transaction consistent with that set forth in the existing agreement. In addition, Dollar General is prepared to revise the agreement to permit Family Dollar to continue to pay its regular quarterly cash dividend through closing on terms consistent with past practice.

Goldman, Sachs & Co. is acting as financial advisor to Dollar General and Simpson Thacher& Bartlett LLP is acting as its legal counsel.

Source:  Home Textiles Today