Dollar Tree to Acquire Family Dollar for $8.5B

Dollar Tree has entered into an agreement to acquire rival Family Dollar for $8.5 billion. With the acquisition Dollar Tree will own and operate more than 13,000 stores and have an annual revenue of excess of $18 billion.

The transaction, which has been unanimously approved by the boards of directors of both companies, is expected to close by early 2015, at which time the Family Dollar shareholders will receive $59.60 in cash and $14.90 equivalent in Dollar Tree shares. Dollar Tree will continue to operate and grow both the Dollar Tree and Family Dollar brands, offering fixed- and multi-price point formats to provide consumers greater value, convenience and choice.

“This is a transformational opportunity,” Bob Sasser, Dollar Tree’s CEO said. “Throughout our history, we have strived continuously to evolve and improve our business. 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. The acquisition of Family Dollar is consistent with our vision to be the leader in value retailing.”

The acquisition allows Dollar Tree to target a broader range of customers and geographies. Dollar Tree targets customers within a broad range of Middle America with stores located primarily in suburban areas and Family Dollar targets low- and lower-middle income households through its urban and rural locations.

"This combination will enable Family Dollar to accelerate efforts to improve the business and will benefit our dedicated team members who will now be part of a larger, more diverse organization," Howard R. Levine, chairman and CEO, Family Dollar said. "I am excited about our future with Dollar Tree, and I look forward to working with the Dollar Tree team to complete the combination as quickly as possible to realize the compelling benefits for all our stakeholders."
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