Market Overview

Carl Icahn Takes Home ~$159 Million On Family Dollar & Dollar Tree Merger

Share:
Carl Icahn Takes Home ~$159 Million On Family Dollar & Dollar Tree Merger
Related FDO
Dollar Store Headwinds Not Uprooting Deutsche From Dollar Tree Buy Rating
Bull And Bear Cases For Dollar Tree Ahead Of Q3 Earnings

The much anticipated merger between Family Dollar (NYSE: FDO) and Dollar Tree (NASDAQ: DLTR) was announced Monday morning.

Dollar Tree is to acquire shares of Family Dollar with cash ($59.60) and stock ($14.90) for $74.50 per share, a 22.8 percent premium on Family Dollar’s Friday closing price. The transactions values Family Dollar at $9.2 billion.

Carl Icahn, who pushed for a merger of the companies, earned an estimated $158.7 million dollars on the transaction. Since showing his stake on June 6 in a 13D filing, Family Dollar shares have appreciated 25.6 percent.

Related: Whitney Tilson: 76% Chance Herbalife Will Fail

Dollar Tree CEO Bob Sasser will serve as CEO of the combined companies, which will operate 13,000 stores with annual revenue greater than $18 billion. Sasser stated, “Combined, our growth potential is enhanced with improved opportunities to increase the productivity of the stores and to open more stores across multiple banners.”

The deal is expected to save more than $300 million per year in synergies, primarily in sourcing, SG&A and logistics.

Shares of Family Dollar were last trading 24 percent higher at $74.26, $0.24 off the transaction price. Dollar Tree share are also strong, rising 6.6 percent to $57.80

Posted-In: Bob Sasser Carl IcahnNews Hedge Funds M&A Hot General Best of Benzinga

 

Related Articles (DLTR + FDO)

View Comments and Join the Discussion!