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Carl Icahn Snipes At Family Dollar After Questions Raised On His Role

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Family Dollar Stores (NYSE: FDO) edged higher Tuesday well above the latest buyout offer, while its former investor Carl Icahn made some critical comments from the sidelines.

But Icahn's statement is sharply at odds with Dollar Tree's (NASDAQ: DLTR) account of merger negotiations filed last week with the Securities and Exchange Commission.

Icahn accused Family Dollar of not fully exploring options and seeking to protect the position of its chief executive, Howard R. Levine, by discouraging bidders other than Dollar Tree with a $301 million breakup fee.

"How far will crony Boards go) to protect the CEO at the expense of shareholders?" Icahn asked rhetorically in a blog post Monday.

Yet Dollar Tree said Icahn drove away its rival bidder for Family Dollar. The bidder, identified as "Company A" in the filing, is widely believed to be Dollar General (NYSE: DG).

Although discussions were held with "Company A" as early as October of last year, following Icahn's involvement it backed out of discussions on June 7, a day after Icahn disclosed his stake.

The company indicated it "would be reluctant to participate in the negotiation of a transaction with Family Dollar if Mr. Icahn were to have a role in or control over the process," the filing said.

Dollar General Monday made unsolicited $78.50 per share cash offer for Family Dollar, topping Dollar Tree's $74.50 bid.

Icahn on July 28 called Dollar Tree's bid "yet another validation of the activist investment philosophy" and sold most of his Family Dollar stake soon after.

Family Dollar traded recently at $79.95 per share, up 0.18 percent.

Posted-In: Carl IcahnNews Rumors M&A


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