GOODLETTSVILLE, Tenn. -- Dollar General Corp., spurned twice in its attempt to acquire Family Dollar Stores Inc. (FDO), is now plotting its next move, according to a Bloomberg report.
The company said Friday that it “remains committed to acquiring Family Dollar,’ standing by its $9.1-billion cash offer for Family Dollar. The retailer is working with financial adviser Goldman Sachs Group Inc. as it ponders its options.
Earlier in the day, Family Dollar rejected the $80-per-share proposal, saying it would be harder to get past antitrust regulators than a lower offer from Dollar Tree Inc.
Dollar General, Goodlettsville, Tenn., could now take its pitch directly to shareholders, something it threatened to do earlier if the bid was rejected. Or the company may come back with a higher offer, though it may be more crucial to assure Family Dollar that it will do whatever it takes to overcome opposition from the U.S. Federal Trade Commission.
“The only way this deal happens is if they give a blanket statement saying we’ll do what the FTC says, or if they go directly to shareholders and shareholders decide if they themselves want to take the risk of the deal going through or not,” said Poonam Goyal, an analyst at Bloomberg Intelligence in New York.
Family Dollar’s board unanimously rejected Dollar General’s bid, which was announced on Sept. 2, and reaffirmed its agreement with Dollar Tree. The move marked the second time the Matthews, N.C.-based company used antitrust concerns to turn down the unsolicited offer from Dollar General, the top U.S. dollar-store chain.
Meanwhile, Dollar Tree and Family Dollar Stores amended their merger agreement to include a commitment by Dollar Tree to divest as many stores as necessary or advisable to obtain antitrust clearance for the previously announced cash and stock transaction. The two companies also said that their expectations for a closing date for the transaction have accelerated to as early as the end of November, according to The Shelby Report.
Chesapeake, Va.-based Dollar Tree and Family Dollar announced in late July that Dollar Tree planned to purchase Family Dollar for $8.5 billion.
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