US: Family Dollar receives $7bn buyout bid
Trian's offer values Family Dollar at more than $7bn
Family Dollar Stores Inc has confirmed it is the target of an unsolicited takeover offer from investment firm Trian Group, the fund run by activist US investor Nelson Peltz, which could value the discount retailer at more than $7bn.
Trian is offering $55 to $60 per share in cash for the Matthews, North Carolina based firm, which operates 6,800 stores and sells a range of products - including clothing - most of which are priced at less than $10.
According to a regulatory filing yesterday (15 February), Trian said it had contacted Howard Levine, Family Dollar's chairman and chief executive, on Tuesday and advised him that it owned around 8% of the retailer's shares, making it the company's largest shareholder.
Trian said it had also "offered Mr Levine the opportunity to participate as an investor" in the deal, and that it believes the ultimate decision on whether or not to accept an offer should rest with shareholders.
Family Dollar says it is reviewing the offer.
The retailer is one of the fastest-growing discount chains in the US, and earlier this year lifted its full-year earnings target after recording an almost 7% rise in first-quarter same-store sales.
The company expects its annual earnings per share to hit between US$3.08 to $3.23, after first quarter profit rose 9.9% to $74.3m.
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