The drama that is the dollar store wars doesn’t appear to be ending anytime soon, with Dollar General extending the life of its latest deal to buy Family Dollar out from under Dollar Tree.
Reuters reports that Dollar General extended its tender offer for shares of Family Dollar to December 31 in order to keep the deal viable until a shareholders meeting.
As of October 30, the day before the original deal was set to expire, Dollar General had only received offers for about 4 million Family Dollar shares of the total 114 million shares currently outstanding.
Industry analysts tell Reuters that Dollar General’s decision to extend the offer deadline was made in order to give Family Dollar shareholders time to make a decision after a mid-December meeting.
The No. 1 dollar store turned hostile and took its pursuit for the smaller dollar store straight to shareholders back in September.
The sordid dollar store love triangle began back in July when Dollar Tree made an $8.5 billion bid for North Carolina-based Family Dollar. Not one to feel left out, Dollar General proceeded to provide an unsolicited bid of $8.95 billion for the smaller chain.
But Family Dollar wasn’t feeling the love and rejected the offer citing “significant antitrust issues” because the two chains have similar business models. Both Dollar General and Family Dollar sell items at different dollar price points, catering to low-income shoppers, while Dollar Tree caters to more middle-income shoppers and sells most items at $1.
Dollar General came back with a second bid of $9.1 billion and in an attempt to ease Family Dollars’ anti-trust review fears it proposed closing 1,500 of the potentially combined companies 20,000 stores.
Yet, that still wasn’t enough and Family Dollar rejected the bid, choosing instead to stay with its true love, Dollar Tree.
Dollar General extends tender offer for Family Dollar shares again [Reuters]
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