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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Walmart Inc | NYSE:WMT | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
-0.38 | -0.64% | 58.97 | 59.41 | 58.72 | 59.35 | 15,493,099 | 01:00:00 |
By Chelsey Dulaney
Family Dollar Stores Inc. has delayed the shareholder vote on its $8.5 billion deal to be bought by Dollar Tree Inc. as the discount retailer awaits an update on the divestitures U.S. antitrust regulators will require to approve the deal.
Family Dollar said it expects an update by the end of the first week of December on the Federal Trade Commission's review of the merger. Family Dollar pushed back the vote to Dec. 23 from Dec. 11.
Dollar Tree has said it would be willing to divestas many stores as possible--or sensible--to get its deal done, and the companies amended their merger agreement to reflect that commitment.
Initially expected to close in November, the deal is aimed at consolidating the market for serving low-income shoppers and building a stronger competitor to rivals like Wal-Mart Stores Inc.
The Wall Street Journal reported in September that Dollar Tree's conversations with the FTC have left it more confident that the acquisition can be approved with some divestitures of stores. The FTC's initial review looked at how pricing is set in markets where Family Dollar and Dollar Tree stores are within 3 miles of each other, and the fact that Dollar Tree primarily sells products for $1 shows that the stores have little effect on each other, a person familiar with the matter said.
In September, Family Dollar shot down rival Dollar General Corp.'s $9.1 billion unsolicited bid, saying the antitrust risks are too high. Dollar General has said it would be willing to divest up to 1,500 stores. Family Dollar, however, was unswayed, saying it had produced a mountain of evidence in antitrust discussions showing how Dollar General is a big rival and a factor in determining its prices.
Family Dollar Chief Executive Howard Levine said there was a "very real and material risk" that Dollar General's offer would fail to pass a lengthy regulatory process.
The two chains run very similar businesses selling a variety of consumable and household products at a range of prices. Both chains confirmed last month that they received requests for additional information from the FTC regarding Dollar General's bid.
Dollar General's tender offer, worth $80 a share, remains open until Dec. 31. In late October, Dollar General said it remained committed to buying Family Dollar and it would mail a proxy statement to its target's shareholders, urging them to vote against the Dollar Tree deal.
Dollar General shares fell 3.2% in morning trading Wednesday, while Family Dollar shares declined 1.3%.
Write to Chelsey Dulaney at Chelsey.Dulaney@wsj.com
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