CHESAPEAKE, VA—Dollar Tree Inc. said Monday it would buy competitor Family Dollar Stores Inc. in a cash-and-stock deal that gives Family Dollar an enterprise value of $9.2 billion including debt. The combined company will operate more than 13,000 stores across the US and Canada under both brands, with annual sales projected at $18 billion, a combination that Dollar Tree says will position it as North America’s largest discount retailer.
Both companies’ boards have unanimously approved the merger. Family Dollar CEO Howard R. Levine, Trian Fund Management LP and Trian-owned funds, which collectively own approximately 16% of Matthews, NC-based Family Dollar’s outstanding stock, have entered into voting agreements supporting the merger. It’s expected to close in early 2015.
“Throughout our history, we have strived continuously to evolve and improve our business,” says Dollar Tree CEO Bob Sasser. “This acquisition, which enhances our footprint and diversifies our company, will enable us to build on that progression, and importantly, positions Dollar Tree for accelerated growth. By offering both fixed-price and multi-price point formats and an even broader, more compelling merchandise assortment, we will be able to provide even greater value and choice to a wider array of customers.”
Check back later today on GlobeSt.com for an assessment of the real estate implications of the Dollar General/Family Dollar deal.