Boston, MA 09/08/2014 (wallstreetpr) – Will the chain of discount retail store operator, Dollar General Corp. (NYSE:DG), boost its bidding price to buy a chain of general merchandise retail store operator, Family Dollar Stores, Inc. (NYSE:FDO)? The offer made by Dollar General has been rejected twice by Family Dollar. Instead, it has reaffirmed its commitment to the deal with Dollar Tree, Inc. (NASDAQ:DLTR).
Dollar General Next Step
The company is no mood to give up its interest to buy Family Dollar. In fact, the company has reaffirmed its commitment to acquire Family Dollar, which snubbed Dollar General’s $80 a share cash offer, a statement issued by the company said.
Dollar General Corp. (NYSE:DG) has even indicated that it was currently evaluating its next course of action in its quest to buy Family Dollar. Though the offer price was very attractive, it was turned down citing antitrust concerns. Dollar General said in its bid that it was ready to sacrifice 1500 stores to protect Family Dollar acquisition and pass the antitrust motion.
Family Dollar Stores, Inc. (NYSE:FDO) said that Dollar Tree, Inc. (NASDAQ:DLTR) has committed to close as many stores as required to get antitrust approval, its statement pointed out. Therefore, it said it preferred to go with its deal rather than Dollar General, which ultimately wants shareholders to take the risk. The company said that it was not attracted by Dollar General’s offer of a breakup fee on the antitrust issue.
Dollar General’s Possible Move
The company can weigh two options before them in order to push through its bid on Family Dollar Stores, Inc. (NYSE:FDO). The first is lifting its offer price over the earlier price of $80 a share and simultaneously increase the number of stores to be closed by them in case it required to meeting the stipulations of antitrust norms.
Secondly, Dollar General Corp. (NYSE:DG) could take up its proposals directly with the shareholders ignoring the management. It has threatened to act in a similar fashion earlier this week in case its offer price was turned down yet again, Bloomberg said. However, in the absence of any big shareholders support, it may find it tough to get through.
Since Family Dollar Stores, Inc. (NYSE:FDO) has raised the concern of antitrust, Dollar General can be expected to offer a commitment saying that it would do whatever the Free Trade Commission wants to fulfill the agreement to acquire Family Dollar.