Jeremy Steinberg
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Jeremy Steinberg in Deals, M&A and more!,

Family Dollar tells Dollar General ‘no’ means ‘no’

Family Dollar calls Dollar General’s tender offer ‘illusory’

More is not always merrier, when it comes to mergers and acquisitions.

Family Dollar Stores once again rejected Dollar General’s recent hostile tender offer on Wednesday, calling it “conditional” and “illusory.” The discount retailer said the offer, which Dollar General commenced on Sept. 10, was no different than the buyout proposal made on Sept. 2 that was unanimously rejected by its board of directors.

Family Dollar FDO, -0.05% believes a buyout by Dollar General DG, -0.41% would have a high risk of getting blocked by regulators because of antitrust concerns. The company continues to support the bid from Dollar TreeDLTR, +0.83% which has about 6,500 fewer stores than Dollar General and a lot less store-location overlap.

Dollar General DG, -0.41% is hoping an extra $600 million, or $5.50 for each share — close to 7% more than Dollar Tree DLTR, +0.83% is offering — is enough to convince Family Dollar FDO, -0.05% shareholders to ignore the obvious.

The green dots in these maps indicate where locations of the two chains are in the same area. More green means more reason for antitrust concerns — and one map has a lot more green.

Where locations of Dollar General and Family Dollar stores are within a few miles of each other.

Where locations of Dollar Tree and Family Dollar stores are within a few miles of each other.

Dollar General took its $9.1 billion buyout offer right to Family Dollar’s shareholders on Wednesday, saying it will tender to buy their shares for $80 each, in cash. Family Dollar urged its shareholders not to give in to its larger rival’s attempt at a hostile takeover, saying it still believes Dollar Tree’s offer, valued at $85 billion, or $74.50 a share, is the way to go.

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