Dollar Tree is selling Dollar Family to a couple of private capital companies for $ 1 billion after a decade of trying to make the acquisition of the bargain chain adjust.
Dollar Tree Inc. acquired family dollar for more than $ 8 billion In 2015 after a war war with rival Dollar General.
Dollar Tree last year announced that he planned near Hundreds of dollar family stores. The company also said at that time that it would register a deterioration of $ 950 million against the family dollar of commercial name, in addition to a good will charge of $ 1.07 billion.
Dollar Tree had been exploring options for the family dollar for a while and said on Wednesday that the sale to Brigade Capital Management and Macellum Capital Management will allow him to concentrate on his main business.
“This is an important milestone on our transformation trip of several years to help us completely achieve our potential,” said Mike Creedon, who was appointed permanent executive director of Dollar Tree at the end of last year.
Neil Saunders, managing director of Globaldata, said that after acquiring the rival chain, Dollar Tree fought with supply chain problems, locations of poor stores and other operational difficulties.
“Basically, Dollar Tree bit much more than he could chew,” he said.
But Dollar Tree had little space to maneuver, particularly in the months prior to sale. Americans have He pressed his expensesEven in bargain chains, such as Consumer confidence in the slides of the economy.
Family Dollar, who moved its headquarters from North Carolina to Chesapeake, Virginia, after sale, will maintain its headquarters in Virginia.
“This transaction presented a unique opportunity to play a key role in the revitalization of an iconic business,” said Jonathan Duskin, CEO and Macellum partner.
Saunders said that Brigade and Macellum have several problems to solve in the family dollar, including prices that are not as acute as many of their rivals and a customer base that is not so loyal.
The agreement is expected to close later in the second quarter.
Dollar Tree actions increased by 5% before the opening bell.
