FTC Oks Dollar Tree-Family Dollar Deal, To Sell 330 Family Dollar Stores

(RTTNews) - The U.S. Federal Trade Commission Thursday approved discount retailer Dollar Tree Inc.'s (DLTR) proposed $9.2 billion acquisition of Family Dollar Stores Inc (FDO), on the condition that 330 Family Dollar stores are sold to private equity firm Sycamore Partners to alleviate competition concerns.

The FTC said both Dollar Tree and Family Dollar sell deeply discounted general merchandise items. The regulator identified 330 stores in local markets from 35 states where competition would be lost if the acquisition went forward as proposed.

According to the FTC, without a remedy, the acquisition is likely to lessen competition by eliminating direct competition between Dollar Tree and Family Dollar, and increasing chances of Dollar Tree unilaterally exercising market power.

Debbie Feinstein, Director of the FTC's Bureau of Competition, said, "Dollar stores offer convenience and value by providing a broad assortment of general merchandise at discounted prices in stores close to where consumers live or work. This settlement will ensure that consumers will continue to benefit from competition among their local dollar stores."

The proposed settlement requires the divestitures to Sycamore Partners to be completed within 150 days after the acquisition. The settlement includes an Order to Maintain Assets, so that Family Dollar maintains the 330 stores until they are divested.