Dollar Tree plans to announce today that a US antitrust review will require no more than 500 stores to be sold in its merger with Family Dollar Stores, a person with knowledge of the matter said.
When Dollar Tree first announced the acquisition in July, the Chesapeake, Virginia-based company had said it was willing to sell as many as 500 stores to gain approval. It plans to announce today that an extended review by the US Federal Trade Commission found the company doesn’t need to divest more stores than it had been prepared to, the person said, asking not to be identified because the details are private.
Dollar Tree agreed to buy its smaller competitor in July for $8.5 billion in cash and stock to create the biggest US discount chain by number of outlets. Family Dollar later spurned a sweetened $9.1 billion cash counteroffer from market leader Dollar General, saying greater overlaps in their operations would make it harder to gain approval from antitrust regulators.
Completion of the deal will be delayed to 30 January, from 30 December, as Dollar Tree works out final details with the FTC, the person said. Dollar Tree Chief Executive Officer Bob Sasser said on a 20 November earnings call he was “confident” the company would need to divest fewer than the 500 stores initially announced.
Randy Guiler, a spokesman for Dollar Tree, didn’t answer a phone call seeking comment outside normal business hours.
The purchase fulfills the ambitions of billionaire investors Carl Icahn and Nelson Peltz, who had acquired major stakes in Family Dollar and pushed for a sale. Peltz, head of Trian Fund Management LP, made an unsolicited bid for Family Dollar in 2011 in an attempt to attract other suitors. That offer was turned down and no other bidders emerged at the time.
Bloomberg News, edited by ESM
