GOODLETTSVILLE, Tenn. (AP) – There’s now a bidding war for Family Dollar, with Dollar General offering about $9.7 billion for the discounter in an effort to trump Dollar Tree’s bid.
Dollar General Corp. said Monday that it would pay $78.50 per share in cash, 3 percent higher than Family Dollar Stores Inc.’s Friday closing price of $76.06.
Last month Dollar Tree Inc. made an $8.5 billion bid for Family Dollar. It offered to pay $59.60 in cash and the equivalent of $14.90 in shares of Dollar Tree for each share they own. The companies put the value of the transaction at $74.50 per share at the time. Including debt and other costs, the companies estimated the transaction to be worth more than $9 billion.
Dollar General said that its offer would create a business with almost 20,000 stores in 46 states and sales of more than $28 billion. The Goodlettsville, Tennessee, company anticipates annual savings of $550 million to $600 million three years after the transaction closes.
Representatives for Dollar Tree and Family Dollar did not immediately respond to requests for comment.