CHESAPEAKE, Va. — Dollar Tree Inc. will be required to close approximately 340 stores to win approval of its acquisition of Family Dollar Stores Inc. The company had initially projected that about 300 locations would be shuttered.
Dollar Tree Inc. will be required to close approximately 340 stores to win approval of its acquisition of Family Dollar Stores Inc. The company had initially projected that about 300 locations would be shuttered.
According to a recent filing with the Securities and Exchange Commission, Dollar Tree says the Federal Trade Commission has largely completed its review. The stores slated for closure, which together represent about $47.4 million in operating income, are nearly all Family Dollar units.
The company also cautioned that while it still intends to close the acquisition in May, "this timing is subject to certain factors beyond the company’s control, including FTC approval."
The deal, which was announced last July, was approved by Family Dollar shareholders in January.
The filing notes that Dollar Tree is continuing to make progress with multiple buyers for the stores to be divested. While none of the buyers are identified, the company does point out that all intend to operate the divested locations as dollar stores, which addresses concerns of the FTC.
Once approved, the combination will create the largest dollar store operator in North America, with 13,000 stores in 48 states, the District of Columbia and five Canadian provinces, and pro forma sales of more than $18 billion. Dollar Tree operated 5,367 stores as of January 31, while Family Dollar finished its second quarter on March 1 with 8,184 stores.
Family Dollar reported a 15.6% decline in net profit to $76.7 million in the second quarter on sales of $2.8 billion. The bottom line includes merger fees of $8.23 million.
