Dive Brief:
- Dollar General Corp. will bring its $9.1 billion offer directly to rival Family Dollar’s shareholders as early as this week, sources have told Reuters.
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Family Dollar’s board unanimously rejected two offers from Dollar General in recent weeks, citing antitrust concerns. The first was a $9 billion bid with a promise to close some 700 stores, followed by a $9.1 billion offer with a promise to close twice the number of stores, plus a $500 million “break-up” fee in the event the deal couldn’t go through.
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Family Dollar has agreed to an acquisition by third rival Dollar Tree, whose lower $8.5 billion offer comes with a new deal to close as many stores the Federal Trade Commission might deem necessary to address antitrust concerns, known as a “hell or high water clause.”
Dive Insight:
A hostile takeover move could drag out the takeover drama among these three dollar stores. Dollar General may be able to achieve the takeover if it offers Family Dollar the “hell or water” promise its rival is demanding. But sources told Reuters that Dollar General doesn’t want to be at the mercy of antitrust regulators, and the company probably doesn't want to divest itself of the number of stores observers say should be closed.
