Tags: dollar general | family dollar | offer | shareholders

Dollar General's Family Dollar Offer Taken to Shareholders

Image: Dollar General's Family Dollar Offer Taken to Shareholders
(dreamstime; Getty Images; Getty Images)

By    |   Wednesday, 10 Sep 2014 10:59 AM

After Family Dollar's leadership rejected its bid twice, Dollar General is going straight to Family Dollar shareholders in its hostile bid to own its smaller rival.

Dollar General is hoping to upend a previous agreement Dollar Tree Inc. made to purchase Family Dollar for $8.5 billion, or $74.50 per share. Dollar General is offering $9.1 billion, or $80 per share, according to Reuters.

The merger comes as low-cost retailers face ever increasing completion from big box retailers like Wal-Mart and Target.

Urgent: Do You Approve Or Disapprove of President Obama's Job Performance? Vote Now in Urgent Poll

"Our offer provides Family Dollar shareholders with significantly greater value than the existing agreement with Dollar Tree as well as immediate and certain liquidity for their shares," Dollar General's chief executive, Rick Dreiling, said in the statement reported on by The New York Times. "By taking this step, we are providing all Family Dollar shareholders a voice in this process, and we urge them to tender into our offer."

Dollar General, by pushing the offer, can now start talks with the Federal Trade Commission about what divestitures it might make for a deal to gain approval, noted the Times. The company said that it would be willing to sell as many as 1,500 stores for approval.

"Additionally, we now can begin the antitrust review process and will have an opportunity to present our position directly to the FTC," Dreiling said. “As we previously have stated, we are confident in the results of our antitrust analysis, and we look forward to a constructive dialogue with the FTC."

Family Dollar and Dollar Tree officials have not comment in media reports about Dollar General's latest move, but experts said it does not come without some challenges.

"Dollar General's maneuver is not without its risks – because it is offering to take over the company without having had access to its confidential financial information," wrote Paul Ziobro of the Wall Street Journal.

"Launching the tender offer will, however, allow Dollar General to start antitrust discussions with the Federal Trade Commission, where it can determine how high a hurdle it would have to clear to get a deal through, a person familiar with the matter said," Ziobro continued.

Urgent: Assess Your Heart Attack Risk in Minutes. Click Here.

Related Stories:

© 2017 Newsmax. All rights reserved.

 
1Like our page
2Share
TheWire
After Family Dollar's leadership rejected its bid twice, Dollar General is going straight to Family Dollar shareholders in its hostile bid to own its smaller rival.
dollar general, family dollar, offer, shareholders
403
2014-59-10
Wednesday, 10 Sep 2014 10:59 AM
Newsmax Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
America's News Page
© Newsmax Media, Inc.
All Rights Reserved