US discount retail chain Dollar Tree has initiated a review of strategic alternatives for Family Dollar, the business it acquired in 2015.
The review may include a sale, spin-off or other disposition.
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The review aims to restructure the business amid still-high inflation and comes after the company stated in November 2023 that it would explore options for the Family Dollar banner, including closing underperforming outlets.
In early 2024 a Reuters report revealed that Dollar Tree plans to close 970 underperforming Family Dollar Stores and invest in the transformation of the remaining stores for long-term growth.
The company operates 8,359 Family Dollar stores as of 3 February 2024.
It is set to close an additional 150 stores by the end of fiscal 2024.
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By GlobalDataDollar Tree has not set a definitive timeline for the completion of the review and has stated that there is no guarantee of a transaction.
The company will not provide further information until a specific action is approved or additional disclosure is deemed necessary.
Dollar Tree chairman and CEO Rick Dreiling said:: “Dollar Tree has been on a multi-year journey to help the company fully achieve its potential.
“The unique needs of each banner at this time – transformation at Family Dollar and growth acceleration at Dollar Tree – lead us to the decision to conduct a thorough review of strategic alternatives for the Family Dollar business.
“Our goal is to position both the Dollar Tree and Family Dollar banners to progress further and faster, and to determine whether the exclusive attention of a dedicated team will benefit both, while creating value for Dollar Tree shareholders and other stakeholders.”
JP Morgan Securities will serve as financial advisor and Davis Polk & Wardwell as its legal advisor for Dollar Tree during the review.
In May 2024 Dollar Tree completed the acquisition of 170 leases of 99 Cents Only stores in the US.
