Dollar Tree Completes Acquisition of Family Dollar (2023)

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  • Creates combined organization with sales exceeding $19 billion annually with more than 13,600 stores across 48 states and five Canadian provinces
  • Gary Philbin named President and Chief Operating Officer of Family Dollar Stores

CHESAPEAKE, Va.--(BUSINESS WIRE)-- Dollar Tree, Inc. (NASDAQ: DLTR), North America’s leading operator of discount variety stores selling everything for $1 or less, announced today that it has completed the acquisition of Family Dollar Stores, Inc., a leading national discount retailer offering name brands and quality, private brand merchandise.

“We are pleased to announce we have completed our acquisition of Family Dollar and we formally welcome the Family Dollar team to the Dollar Tree organization,” stated Bob Sasser, Chief Executive Officer. “This is a transformational opportunity for our business to offer broader, more compelling merchandise assortments, with greater values, to a wider array of customers. This acquisition will extend our reach to low-income customers, while strengthening and diversifying our footprint. We plan to leverage best practices across both organizations to deliver significant cost synergies. Combined, our growth potential is enhanced with improved opportunities to increase store productivity and to open more stores across multiple banners.”

Under the terms of the merger agreement first announced and unanimously approved by each company’s Board of Directors in July 2014, Family Dollar shareholders are entitled to receive $59.60 in cash and 0.2484 of a share of Dollar Tree common stock for each share of Family Dollar common stock.

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The Company also announced that Gary Philbin, age 58, has been named President and Chief Operating Officer of Family Dollar, effective immediately. In his new role, Mr. Philbin will continue to report to Bob Sasser. Mr. Philbin joined Dollar Tree as Senior Vice President of Stores in December 2001, and was later promoted to Chief Operating Officer in March 2007 and to President in June 2013. Prior to joining Dollar Tree, Mr. Philbin held senior-level positions in both merchandising and operations during his thirty years in the retail grocery industry.

“I am very proud to announce that Gary will be taking on his new leadership role of Family Dollar Stores,” Sasser said. “Gary has played an integral role in the success of Dollar Tree over the past fourteen years. Notably, Gary was instrumental in improving the Dollar Tree customer shopping experience and the related customer satisfaction, as well as leading the integration following our Canadian acquisition in 2010.”

Philbin stated, “I am very pleased to have the opportunity to lead the Family Dollar team. Throughout the due diligence and integration planning processes, I have been impressed with the experience, talent and dedication of the Family Dollar team members. Our focus as an organization will be on the customer - by consistently providing great values, affordable prices, and relevant items in a store environment that is convenient, clean, reliable and efficient. We are well-prepared for the integration process, which is now under way.”

Additionally, the Company announced that Howard R. Levine, Chief Executive Officer of Family Dollar, has been appointed to Dollar Tree’s board of directors, effective immediately.

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Sasser concluded, “We appreciate the efforts, dedication and teamwork displayed by both Dollar Tree and Family Dollar associates throughout our integration planning processes. We are well-prepared to integrate our two companies.”

Strategic Rationale

  • Creates a leading discount retailer in North America. The combined organization will operate more than 13,000 stores in 48 states and five Canadian provinces, with sales exceeding $19 billion annually and over 145,000 associates.
  • Complementary business model across fixed- and multi-price point. Dollar Tree is the nation’s leading operator of fixed-price point stores, selling everything for $1 or less, and Family Dollar is a leading national operator of multi-price point stores providing value-conscious consumers with a selection of competitively priced merchandise in convenient neighborhood stores. The Company intends to retain and to grow both banners going forward and will optimize the combined real estate portfolio.
  • Targets broader range of customers and geographies. Dollar Tree targets customers within a broad range of Middle America with stores located primarily in suburban areas and Family Dollar targets low- and lower-middle income households through its urban and rural locations. The transaction enables Dollar Tree to serve a broader range of customers and deliver even greater value to them.
  • Leverages complementary merchandise expertise. Dollar Tree’s merchandise mix consists of a balance between consumable merchandise and variety/seasonal merchandise. Family Dollar’s assortment consists primarily of consumable merchandise and home products. The complementary offerings enable the Dollar Tree and Family Dollar brands to expand categories and to deliver a broader, more compelling assortment to all customers.
  • Generates significant synergy opportunities. Dollar Tree expects to generate significant efficiencies through sourcing and procurement, format optimization, SG&A leverage, and its distribution network. The Company anticipates that the transaction will result in an estimated $300 million of annual run-rate synergies to be fully realized by the end of the third year post-closing.
  • Enhanced financial performance and improved growth prospects. Dollar Tree will be better positioned to invest in existing and new markets and channels and to grow its store base across multiple brands. The combined company expects to generate significant free cash flow, enabling it to pay down debt rapidly.

J.P. Morgan Securities LLC acted as exclusive financial advisor to the board of directors of Dollar Tree, and J.P. Morgan Chase Bank, N.A. committed to provide bridge financing for the transaction. Wachtell, Lipton, Rosen & Katz and Williams Mullen acted as legal counsel to Dollar Tree in connection with the transaction. Morgan Stanley & Co. LLC acted as exclusive financial advisor to the board of directors of Family Dollar in connection with the transaction. Cleary Gottlieb Steen & Hamilton LLP acted as legal counsel to Family Dollar in connection with the transaction.

About Dollar Tree, Inc.

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Dollar Tree, a Fortune 500 Company, now operates more than 13,600 stores across 48 states and five Canadian provinces. Stores operate under the brands of Dollar Tree, Dollar Tree Canada, Deals and Family Dollar. To learn more about the Company, visit www.DollarTree.com.

Forward Looking Statements

A WARNING ABOUT FORWARD-LOOKING STATEMENTS: Our press release contains "forward-looking statements" as that term is used in the Private Securities Litigation Reform Act of 1995. Forward-looking statements address future events, developments or results and typically use words such as believe, anticipate, expect, intend, plan, forecast, or estimate. For example, our forward-looking statements include statements regarding the merger with Family Dollar, including the benefits, results and effects of the merger, future financial and operating results, including estimated synergies, expectations concerning the combined company's plans, objectives, expectations (financial or otherwise) and intentions. Risks and uncertainties related to the proposed merger include, among others, difficulties related to integration of the proposed merger and our ability to obtain cost savings and synergies contemplated by the merger, unexpected costs, charges or expenses resulting from the proposed merger, and the outcome of pending or potential litigation or governmental investigations. For a discussion of the risks, uncertainties and assumptions that could affect our future events, developments or results, you should carefully review the “Risk Factors,” "Business," and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections in our Annual Report on Form 10-K filed March 13, 2015. We are not obligated to release publicly any revisions to any forward-looking statements contained in this press release to reflect events or circumstances occurring after the date of this report and you should not expect us to do so.

View source version on businesswire.com: http://www.businesswire.com/news/home/20150706005648/en/

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Dollar Tree, Inc.
Randy Guiler, 757-321-5284
Vice President, Investor Relations
www.DollarTree.com

Source: Dollar Tree, Inc.

Released July 6, 2015

FAQs

Did Dollar Tree acquire Family Dollar? ›

"We are pleased to announce we have completed our acquisition of Family Dollar and we formally welcome the Family Dollar team to the Dollar Tree organization," stated Bob Sasser, Chief Executive Officer in the release. Read the full release HERE.

When did Dollar Tree Buy Out Family Dollar? ›

Clothing, cleaning supplies, home decor, and grocery. 59,330 "Family Dollar LinkedIn". In June 2014, activist investor and major shareholder Carl Icahn demanded that Family Dollar be immediately put up for sale. On July 28, 2014, Dollar Tree announced that it would buy Family Dollar for $8.5 billion.

Why is Dollar Tree no longer a dollar? ›

Rising costs

It becomes more challenging for Dollar Tree and other low-cost stores to hold prices at a fixed level and maintain its profitability as everything becomes costlier.

Why is Dollar Tree being sued? ›

A Dollar Tree class action lawsuit accused the discount retailer of forcing workers to pay for a required work uniform without providing reimbursement in violation of California employment law.

What did Dollar Tree change its name? ›

A spokesperson told the Wall Street Journal that the retailer has no plans to change its name. Dollar Tree is the last of the dollar stores to increase its prices above the namesake price point.

Is Dollar Tree 1.25 now? ›

Our transition to the $1.25 price point has enabled our merchants to greatly enhance value,” Dollar Tree CEO Michael Witynski said on a call with analysts Tuesday.

Why is everything at Dollar Tree so cheap? ›

Sometimes, products hit the dollar stores because of damage or lack of freshness. BUT, they are often just offered cheaper because they operate on slimmer margins than grocery stores. Many items were surplus or overstock items from a company.

Is Dollar Tree raising prices to $3? ›

After announcing its previous pricing initiative had been successfully implemented at all 7,800 of its Dollar Tree branded stores — two months ahead of schedule — President and CEO Michael Witynski told analysts and investors that the company was moving ahead with plans to roll out $3 and $5 product bundles in the ...

What is the trouble with dollar stores? ›

Dollar stores stock very few fresh foods if they stock any. And, as the ILSR put it, “this has exacerbated the problem of food deserts and further eroded the economic prospects of vulnerable communities.”

What is the smallest dollar amount one can sue for? ›

As far as the minimum amount you can actually sue someone for, there is no limit. Legally, you can sue someone for any amount in court. The only criteria which has to be met, is that there is a valid cause of action. This refers to issues such as an unpaid debt.

How much debt does Dollar Tree have? ›

Dollar Tree long term debt for the quarter ending October 31, 2022 was $3.420B, a 5.86% increase year-over-year. Dollar Tree long term debt for 2022 was $3.417B, a 5.91% increase from 2021.
...
Compare DLTR With Other Stocks.
Dollar Tree Annual Long Term Debt (Millions of US $)
2019$4,265
2018$4,762
2017$6,170
2016$7,238
10 more rows

Is Dollar Tree in debt? ›

The debt/equity ratio can be defined as a measure of a company's financial leverage calculated by dividing its long-term debt by stockholders' equity. Dollar Tree debt/equity for the three months ending October 31, 2022 was 0.41.

How is Dollar Tree doing financially? ›

Additionally, the Company continues to experience inflationary cost pressures. The Company expects consolidated net sales for the fourth quarter of 2022 will range from $7.54 billion to $7.68 billion, based on a mid- to high-single-digit increase in same-store sales for the enterprise.

What companies are owned by Dollar Tree? ›

Dollar Tree, Inc. owns and operates discount variety stores offering merchandise at the fixed prices. It operates stores under the names Dollar Tree, Deal$, Dollar Tree Deal$, Dollar Giant and Dollar Bills.

What is the oldest dollar store? ›

The first Dollar General store opened in Springfield, Ky. on June 1, 1955, and the concept was simple – no item in the store would cost more than one dollar. The idea became a huge success and other stores owned by J.L. Turner and his son Cal Turner Sr.

Which is better Dollar Tree or Family Dollar? ›

In her experience, “Dollar Tree offers a wider variety of products for a single dollar, while Family Dollar has a more limited selection but often offers sales and discounts.”

How much is Family Dollar worth 2022? ›

In the fiscal year ended January 30, 2022, Family Dollar seasonal and electronic product sales amounted to 1.13 billion U.S.. dollars, a marginal increase from 1.11 billion recorded a year earlier.

How much does Family Dollar CEO make? ›

Performance Vs. Pay Rank: 93 / 189Family Dollar Stores's 6-Year Annual Total Return (%)5
Mr. Levine's 6-Year Average Compensation $2,504 thou6-Year Return Relative to Industry97
6-Year Return Relative to Market106
Relative returns: 100 equals the market or industry.

Is Dollar Tree losing money since raising prices? ›

Those rising costs have squeezed Dollar Tree's profits and margins. During the first three quarters of 2021, the chain's profit margin dropped 1.5% from the same stretch last year. The falloff was particularly steep last quarter, down 4.7% percent from the same quarter a year ago to around 30%.

Why is Dollar Tree increasing prices? ›

The company said the higher price point is a permanent move, and not the result of “short-term or transitory market conditions.” Moreover, the $1.25 price point allows the company to offer a wider range of merchandise, including items that had been discontinued at the $1 level.

Is Dollar Tree really raising their prices? ›

In late November 2021 Dollar Tree, one of the largest national dollar-store brands and a place I shop regularly, announced that after 35 years of offering all merchandise for just $1, it was raising the price across the board to $1.25. It's a sign of our inflationary times.

What are the 10 things not to buy at the dollar store? ›

11 Things Never to Buy from the Dollar Store
  • Knives. 1/12. Good chef's knives don't come cheap, so you might be tempted to pick up a blade or two at the dollar store. ...
  • Plastic Kitchen Utensils. 2/12. ...
  • Medicine and Vitamins. 3/12. ...
  • Pet Food. 4/12. ...
  • Makeup. 5/12. ...
  • Sunscreen. 6/12. ...
  • Toys. 7/12. ...
  • Batteries. 8/12.

What states have no Dollar Tree? ›

States and Territories without any Dollar Tree retail stores
  • Puerto Rico.
  • Hawaii.
  • Alaska.
  • American Samoa.
  • Guam.
  • U.S. Virgin Islands.
  • Northern Mariana Islands.
Jan 8, 2023

Has Dollar Tree lost customers? ›

Dollar Tree saw a “meaningful decline” in shoppers following the price hike, according to a Jan. 11 note from industry tracker Coresight Research.

Where is the largest Dollar Tree in the world? ›

Today I take you around the World's Largest Dollar Tree located in Burlington, North Carolina.

Is the Dollar Tree cheaper than Walmart? ›

Is Dollar Tree cheaper than Walmart? The short answer is that yes, Dollar Tree can be cheaper than Walmart when it comes to buying certain things. This is based on the unit price you'll pay at Dollar Tree vs.

What is the highest price for Dollar Tree? ›

Dollar Tree prices items at $1.25+, with the Dollar Tree Plus stores selling items for as high as $5.00 each. Family Dollar prices operate more like a traditional grocery store, with some items even going for over $20.

Where do poor people shop? ›

The lower the income, the more likely consumers are to buy their groceries at dollar stores or mass discount stores like Walmart, Target, and Dollar Tree. They have a preference for familiar stores because they know they can get what they need at the right price.

Is the dollar on the decline? ›

While the U.S. dollar has surged for much of 2022, its rally has started losing steam in the final months of the year. In September of 2022 the Dollar Index was up 20% on the year reaching a high of 114.8, but has since retreated and given back more than half its gains for this year so far.

What state has the most dollar stores? ›

There are 18,886 Dollar General retail stores in the United States as of January 09, 2023. The state with the most number of Dollar General locations in the US is Texas, with 1,760 retail stores, which is about 9% of all Dollar General retail stores in the US.

How do you get someone to pay you back without going to court? ›

Send a Demand Letter

A demand letter is a formal letter that requests repayment. A formal letter to someone who owes you money has the following benefits: They take you more seriously with a letter. A letter tends to show you are serious about getting your money back.

Can you take a friend to court over money? ›

In most cases that can be done online. If your friend still refuses to pay, though, you can ask the court to order them to cough up. You may have to go to a hearing if they still dispute the figure you claim you owe them, or if they reject the claim in the first place.

What is the most amount of money sued? ›

Tobacco settlements for $206 billion [The Largest Ever]

Many participating states have been criticized for using the settlement funds as collateral for bond financing, putting money into public accounts sooner but reducing the overall settlement value after bonds are repaid with interest.

What state is deepest in debt? ›

In 2020, the federal state of California had about 519.54 billion U.S. dollars of debt outstanding, the most out of any state.
...
StateDebt in billion U.S. dollars
California519.54
New York368.28
Texas324.21
Illinois159.31
9 more rows
Oct 21, 2022

Who owes the most money to the US? ›

Top Foreign Owners of US National Debt
  • Japan. $1,212.8. 17.01%
  • China. $980.8. 13.76%
  • United Kingdom. $634. 8.89%
  • Switzerland. $294.1. 4.13%
  • Cayman Islands. $293.2. 4.11%

Who owns the largest debt in the United States? ›

Japan is the largest holder of U.S. debt.

Does Dollar Tree do well in a recession? ›

Summary. Dollar Tree is a counter-cyclical name that has stronger appeal during recessions.

How rich is the owner of Dollar Tree? ›

The estimated net worth of Michael A. Witynski is at least $1 Million dollars as of 2023-01-22. Michael A. Witynski is the President and CEO of Dollar Tree Inc and owns about 9,479 shares of Dollar Tree Inc (DLTR) stock worth over $1 Million.

How much money does the CEO of Dollar Tree have? ›

$10,767,887

Are Family Dollar Dollar Tree and Dollar General owned by the same company? ›

The short answer is that Dollar General and Dollar Tree are separate companies. They're competitors, just like Walmart and Target, CVS and Walgreens, or AT&T and Verizon.

Does Dollar Tree own any other companies? ›

In July, 2015, Dollar Tree completed its acquisition of Family Dollar Stores, Inc., a leading national discount retailer offering name brands and quality, private brand merchandise. We are pleased to welcome the Family Dollar team to the Dollar Tree organization. You can visit the website at FamilyDollar.com.

Who did Dollar General merge with? ›

(NYSE: DG) today announced that it has entered into an agreement to be acquired by affiliates of Kohlberg Kravis Roberts & Co. L.P. ("KKR") in a transaction with a total value of approximately $7.3 billion, including approximately $380 million of net debt.

Can you work for Dollar Tree and Dollar General at the same time? ›

Absolutely you can work at multiple stores. Chances are you don't have a set schedule anyway so you can fill in as needed at other stores.

Where is the largest Dollar Tree? ›

Today I take you around the World's Largest Dollar Tree located in Burlington, North Carolina.

What country owns Dollar Store? ›

Dollar General Corporation is an American chain of variety stores headquartered in Goodlettsville, Tennessee. As of January 1, 2023, Dollar General operates 18,774 stores in the continental United States.

What's the difference between Dollar Tree and Dollar General? ›

Dollar General has long been willing to sell goods above the $1 threshold, though most merchandise in its stores is $10 or less. Dollar Tree, which was long the industry pure play, selling everything for $1 or less, owns the Family Dollar chain that also sells a mix of goods at various price points.

Is Popshelf owned by Dollar General? ›

Dollar General is planning to accelerate the expansion of Popshelf, its concept targeting suburban women, with a goal of reaching 1,000 locations by 2025. Introduced last October, Popshelf focuses on home decor, seasonal entertaining and health and beauty, with 95 percent of items priced below $5.

Who is Dollar General's biggest competitor? ›

Dollar General's competitors. Dollar General's competitors and similar companies include Walgreens, Walmart, Family Dollar Stores, Dollar Tree and Target. Dollar General is a discount retailer selling products from various brands. Walgreens is a store that provides pharmaceutical and beauty products.

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