Dollar General Enters Into Family Dollar Bidding

Today, Dollar General announced that it has made a proposal to acquire Family Dollar Stores, Inc. for $78.50 per share in cash. Dollar General valued the transaction at $9.7 billion, enough, it asserted, to outbid Family Dollar’s other suitor, Dollar Tree.

Dollar General stated that it conveyed its proposal this morning in a letter to Family Dollar’s board of directors.

The transaction, Dollar General declared, would deliver increased consideration to Family Dollar’s shareholders while representing a compelling opportunity to create value for its own stockholders. The combination with Family Dollar would solidify Dollar General’s position as the largest small-box discount retailer in the United States with about 20,000 stores in 46 states and sales of more than $28 billion.

Its all-cash proposal of $78.50 per share would provide Family Dollar shareholders with a substantially superior valuation to the $74.50 per share cash and stock offer announced by Dollar Tree, Inc. on July 28, Dollar General insisted.

“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,” Rick Dreiling, Dollar General’s chairman and CEO said in announcing the bid. “For Dollar General shareholders, the proposed combination of Dollar General and Family Dollar would be a significant strategic opportunity to create immediate and lasting shareholder value. For both Dollar General and Family Dollar customers, we would be able to provide better value and greater selection. We have the utmost respect for Family Dollar, its leadership and its employees. 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.”

On July 28, Dollar Tree announced in a joint statement with Family Dollar that it had entered into a definitive merger agreement to acquire that company for $74.50 per share, with $59.60 in cash and $14.90 equivalent in Dollar Tree shares.


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