- District attorneys from 20 states have joined an antitrust investigation of bids from Dollar General and Dollar Tree to acquire Family Dollar.
- Attorneys enacting the investigation are concerned that, following a merger, the stores could raise prices in the discount stores, and many of their customers depend on lower prices to afford these products.
- Last week, Family Dollar reported a 47% drop in quarterly profit, and net income fell to $41.4 million in the first fiscal quarter, down from $78 million in the same quarter last year.
This is only the most recent news in what's been a longstanding potential deal in the making. In July, Dollar Tree was to acquire Family Dollar for $8.5 billion, but Dollar General entered a competing offer for $8.9 billion, which started the bidding war that eventually led to the antitrust investigation. At first, Family Dollar refused the offer from Dollar General, after which Dollar General raised its bid to $9.1 billion. Dollar Tree then agreed to close up to 500 of its own stores in the merger to resolve antitrust concerns. Shareholders have not come to an agreement on the matter, and the ongoing investigation is likely to keep this acquisition tabled for now.