Dollar Tree, Family Dollar Expected To Close 340 Stores For Merger Approval

When Family Dollar accepted Dollar Tree’s proposal for a merger in January, the two companies estimated the deal would require the closing of no more than 300 stores. As federal regulators get closer to putting their stamp of approval on the dollar store marriage, they’re adding a few more stores to the chopping block.

The Wall Street Journal reports that the Federal Trade Commission has identified 340 stores for divestiture as part of its merger review.

Representatives for Dollar Tree told the WSJ Tuesday that most – if not all – of the stores singled out for divestiture will be Family Dollar locations representing about $47.4 million in operating revenue.

Although the locations of the stores slated to close haven’t been revealed, Dollar Tree says it has received some signals of interest from potential buyers that would continue to operate the outlets as dollar stores.

While the number of stores targeted for closing is more than the two dollar chains anticipated earlier this year, it’s still far less than what could have been earmarked has Family Dollar decided to merge with Dollar General.

During the courting process, Family Dollar argued that closing the deal with Dollar Tree was a “virtual certainty” compared to Dollar General’s heftier bid, which they say wouldn’t stand up to regulatory approval.

In a letter to shareholders January, Family Dollar said that following talks with the government, they believed it would be difficult for Dollar General to divest itself of enough stores to secure approval, saying there could be as many as 3,500 to 4,000 “presumptively problematic” stores in Dollar General’s proposal.

The merger between Dollar Tree and Family Dollar is expected to be completed by May.

Dollar Tree: FTC Nears End of Family Dollar Merger Review [The Wall Street Journal]

Want more consumer news? Visit our parent organization, Consumer Reports, for the latest on scams, recalls, and other consumer issues.