Dollar Tree has announced that the company has initiated a formal review of strategic alternatives for the company’s Family Dollar business segment, which could include, but is not limited to, a potential sale, spin-off or other disposition of the business.
“Dollar Tree has been on a multi-year journey to help the company reach its full potential,” said Rick Dreiling, President and CEO of Dollar Tree, Inc. “Last year we announced a comprehensive review of Family Dollar’s portfolio. , which included the planned closure of approximately 970 underperforming Family Dollar stores to focus on enhanced investments in the remaining Family Dollar stores that present favorable long-term growth and transformation opportunities, with more attractive returns on capital. We are already beginning to see the progress of this strategy in the Family Dollar brand. At the same time, we continue to aggressively grow the Dollar Tree brand through compelling initiatives such as our expanded multi-price offerings, major planned new store openings across the United States, and growth transactions such as our recent successful bid to acquire up to 170 Dollar Tree stores. 99 Cents Only. The unique needs of each brand at this time – transformation at Family Dollar and acceleration of growth at Dollar Tree – have led us to make the decision to conduct a comprehensive review of strategic alternatives for the Family Dollar business. Our goal is to position both Dollar Tree and Family Dollar brands to progress further and faster, and determine whether the undivided attention of a dedicated team will benefit both, while creating value for Dollar Tree shareholders and other stakeholders. ”
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Dollar Tree has not established a definitive timeline or schedule for completion of the strategic alternatives review process, and there can be no assurance that this process will result in any particular transaction or outcome. The Company does not intend to comment further unless and until the Board has approved a specific course of action or the Company has otherwise determined that additional disclosure is appropriate or necessary.
Dollar Tree has retained JP Morgan Securities LLC as its financial advisor and Davis Polk & Wardwell LLP as its legal advisor to assist in this review.
Dollar Tree Reports
Dollar Tree operated 16,397 stores in 48 states and five Canadian provinces as of May 4, 2024. The stores operate under the Dollar Tree, Family Dollar and Dollar Tree Canada brands.
During the fourth quarter of fiscal 2023, the Company announced that it had initiated a comprehensive store portfolio optimization review that involved the identification of stores for closure, relocation, or re-bannering based on an assessment of current market conditions. and individual store performance, among other factors. As a result of this review, the Company announced that it planned to close approximately 600 Family Dollar stores in the first half of fiscal 2024. Additionally, approximately 370 Family Dollar stores and 30 Dollar Tree stores would close in the coming years at the end of the lease term. current of each store.
As of the end of the first quarter of fiscal 2024, the Company had closed approximately 550 stores as part of portfolio optimization and expects to close another 150 stores by the end of fiscal 2024.
