Intentions of Dollar Tree, Inc. (NASDAQ:DLTR) to buy Family Dollar Stores, Inc. (NYSE:FDO) don’t seem to go anywhere. DLTR looks forward to shutting down lesser than 300 stores in US to execute the buyout transaction. The announcement has come from DLTR after U.S. regulators asked to investigate its proposed take-over of FDO.
Why are analyst so optimistic about DLTR?
Insights of the matter:
DLTR had 5282 stores spread across U.S. and Canada as of November 1, 2014. Recently the company announced that it would be signing an agreement with the U.S. Federal Trade Commission by the end of the January in order to decide the number of stores that would be closed by the company. The company has decided to go by the rules and regulations of the local government in order to successfully execute the take-over transaction.
Talking about the potential buyers of these stores, Neev Capital’s Rahul Sharma said that Wal-Mart Stores, Inc. (NYSE:WMT) and Target Corporation (NYSE:TGT) could buy these stores. Rahul Sharma is the managing director of the Investment Advisory Firm Neev Capital.
As per the reports, Dollar Tree, Inc. (NASDAQ:DLTR) has agreed to buy Dollar Stores, Inc. (NYSE:FDO) for $8.5 billion in stock and cash. The decision came after the latter disagreed to execute the hostile offer worth $9.1 billion given by Dollar General Corp. (NYSE:DG). There was a voting conducted about this transaction on December 23, 2014, in which all the shareholders of FDO declined the offer due to the risk associated with the transaction. FDO has again asked its shareholders to vote for the takeover deal executed by DLTR in the upcoming shareholders meeting, which is likely to take place on January 22, 2015.
Recently, Bob Sasser, CEO of Dollar Tree, Inc. (NASDAQ:DLTR) wrote a letter to Dollar Stores, Inc. (NYSE:FDO) stating that the company had waited a lot for executing the transaction, but its patience had ended due to delay in the proceedings. Both the companies faced negative growth in the stock market during the previous trading session.
