Family Dollar to Go with Dollar Tree, Turns Down Dollar General
August 21, 2014,
MATTHEWS, N.C.-Citing antitrust issues, Family Dollar's board of directors has unanimously rejected Dollar General's bid to acquire its dollar-store rival, three days after Dollar General made the proposal.
On Aug. 18, Dollar General announced its all-cash bid of about $9.7 billion to purchase Family Dollar. In today's statement, the Family Dollar board unanimously reaffirmed its recommendation in support of the merger agreement with Dollar Tree. Family Dollar and Dollar Tree announced their agreement for Dollar Tree to acquire Family Dollar for about $8.5 billion in late July.
In its statement, Family Dollar said its board had determined that the Dollar General proposal, if carried out, would have raised "significant antitrust issues," although the statement did not further define these issues. The board, along with its financial and legal advisors, conducted "an extensive antitrust analysis" and concluded that the Dollar General deal was not likely to be completed under its proposed terms.
In the Family Dollar statement, Levine said Dreiling's letter "contained blatant mischaracterizations and did nothing to address the antitrust issues in Dollar General's proposal." However, the statement was not specific about the mischaracterizations. Contacted by HFN, Family Dollar had not responded by press time.