Family Dollar Fights Off Takeover Bid
Family Dollar Fights Off Takeover Bid
Family Dollar Stores Inc. has reportedly fought off a hostile takeover bid from Trian Fund Management LP, a hedge fund managed by Nelson Peltz. The bid “substantially” undervalues the discount retailer, the company said Thursday, and has prompted the company to begin developing a defensive strategy to discourage unsolicited buyout offers.
Family Dollar initiated a plan last year to accelerate store openings and remodels, as well as repurchase shares. The company describes the plan as the best way it can deliver value to shareholders. Family Dollar stock has fallen now in seven of the ten trading sessions since Trian extended the takeover offer on February 15th, indicating investors may be somewhat leery of the offer's $55 to $60 per share valuation totaling $7.7 billion.
Nelson Peltz, who runs the Trian fund, is an activist investor who rarely buys entire companies. He reportedly never arranged financing for the potential buyout, which would have been the largest acquisition of a US retail company in six years.
Family Dollar Stores Inc. has reportedly fought off a hostile takeover bid from Trian Fund Management LP, a hedge fund managed by Nelson Peltz. The bid “substantially” undervalues the discount retailer, the company said Thursday, and has prompted the company to begin developing a defensive strategy to discourage unsolicited buyout offers.
Family Dollar initiated a plan last year to accelerate store openings and remodels, as well as repurchase shares. The company describes the plan as the best way it can deliver value to shareholders. Family Dollar stock has fallen now in seven of the ten trading sessions since Trian extended the takeover offer on February 15th, indicating investors may be somewhat leery of the offer's $55 to $60 per share valuation totaling $7.7 billion.
Nelson Peltz, who runs the Trian fund, is an activist investor who rarely buys entire companies. He reportedly never arranged financing for the potential buyout, which would have been the largest acquisition of a US retail company in six years.
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