Family Dollar has rejected a takeover bid from dollar-store competitor Dollar General, saying it would be too hard for the deal to pass antitrust regulators. Family Dollar's board said it supports its existing deal to be acquired by Dollar Tree.
Family Dollar Stores Inc. Chairman and CEO Howard Levine said in a statement Thursday that its board and advisers reviewed Dollar General Corp.'s offer and determined it wasn't reasonably likely to be completed on the terms proposed.
Dollar General Chairman and CEO Rick Dreiling said in a statement that the company was disappointed in Family Dollar's decision, and that it had done an extensive antitrust analysis that confirmed its proposal could be completed. Dollar General said it was willing to share its analysis with Family Dollar and that it was still confident it could resolve any regulatory concerns about competition.
Dollar General said is reviewing its options and still believes its offer is better than the Dollar Tree deal.
The businesses of Family Dollar and Dollar General are more similar than Dollar Tree's. The first two sell items at a variety of prices, while at Dollar Tree, all items are a buck.
Family Dollar became a takeover target in part because of its business struggles. The Matthews, North Carolina, company has been shuttering stores and cutting prices in hopes of boosting its financial performance. In June investor Carl Icahn urged the company to put itself up for sale.
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