Dollar Tree hopes to finalize its acquisition of Family Dollar by the end of April. Dollar Tree CEO Bob Sasser outlined the company’s strategy for integrating the two companies on a call with investors Wednesday.
Federal regulators still have to approve the $8.7 billion deal Family Dollar shareholders approved in January. Sasser says that approval could come next week. The combined company will have 13,000 stores. Sasser says he expects regulators will require the company to agree to close about 300 Family Dollar stores to finalize the deal.
Dollar Tree’s strategy for the new company is to leverage its larger size for better wholesale prices. Another part of the plan is to convert some Family Dollar stores to Dollar Tree stores, and vice versa.
"We plan to re banner stores selectively to better match the brand to the market demographic and to improve productivity of the store," Sasser explains.
He says the first round of conversions will be Family Dollar stores that become Dollar Tree stores. But he doesn’t rule out rebranding Dollar Tree stores in the future.
Sasser says the two companies’ business models complement each other. Dollar Tree sells all of its products for one dollar or less. Family Dollar sells items at multiple prices.
Virginia-based Dollar Tree reported fiscal fourth quarter earnings of 206 million dollars, that’s down about 3 percent from the same quarter last year. But it includes the cost of buying Family Dollar.
