Dive Brief:
- Dollar General has increased its offer to buy rival Family Dollar to $80 a share—a bid that would value the deep discount grocer at roughly $9.1 billion.
- The new offer comes just days after Family Dollar rejected an earlier bid by Dollar General and said it would move forward with a smaller offer from Dollar Tree.
- In the new offer, Dollar General, the largest of the dollar stores, more than doubled the number of stores it says it would be willing to divest to win regulatory approval—from 700 to 1,500.
Dive Insight:
Dollar General has acknowledged the elephant in the room—it won't be easy to get regulators to approve a deal that consolidates power among the companies that sell food to some of the poorest folks in America.
But "not easy" isn't the same as impossible. And Dollar General's willingness to sell off some 1,500 stores will go a long way toward winning regulators' favor. In fact, Dollar General appears confident that such an offer is enough to get the feds to approve the deal. In its new bid this morning, Dollar General said it would pay a $500-million fee to Family Dollar if regulators reject the merger.