Updated: August 21, 2014 7:53AM
MATTHEWS, N.C. — Family Dollar is rebuffing Dollar General’s takeover bid, citing antitrust issues. The discounter’s board remains supportive of its existing deal with Dollar Tree.
Family Dollar Stores Inc. Chairman and CEO Howard Levine said in a statement Thursday that its board and advisers reviewed Dollar General Corp.’s offer and determined it wasn’t likely to be completed on the terms proposed.
On Monday Dollar General — the nation’s biggest dollar-store chain — offered about $8.95 billion for Family Dollar. The company said at the time that it believed it could quickly address any antitrust issues and was willing to divest up to 700 of its stores in order to get the necessary approvals.
Last month Family Dollar agreed to an $8.5 billion deal with Dollar Tree Inc.
Separately, Dollar Tree said Thursday its second-quarter profit fell more than 2 percent on costs related to its planned acquisition of Family Dollar even though shoppers spent more at its discount stores.
Dollar Tree reported earnings of $121.5 million, or 59 cents per share for the period ended Aug. 2, compared with $124.7 million, or 56 cents per share, in the year-ago quarter.
Excluding costs related to the buyout of Family Dollar Stores Inc., Dollar Tree said it earned 61 cents per share. Analysts surveyed by Zacks Investment Research expected earnings of 65 cents per share.
The Chesapeake, Virginia-based company, which operates more than 5,165 stores in the U.S. and Canada, saw revenue increase 9.5 percent to $2.03 billion, topping Wall Street expectations of $2.01 billion.