Dollar Tree, Inc. has initiated a strategic review of its struggling Family Dollar segment, considering options including a sale, a spinoff or “other disposition of the business,” according to a statement.
“Dollar Tree has been on a multi-year journey to help the company fully achieve its potential,” said Rick Dreiling, Chairman and CEO of Dollar Tree, Inc. in a statement. “Last year, we announced a comprehensive review of the Family Dollar portfolio, including the planned closure of approximately 970 underperforming Family Dollar stores to focus on enhanced investments in remaining Family Dollar stores that present favorable opportunities for long-term growth and transformation, with more attractive returns on capital.”
While the retailer is “already beginning to see progress in this targeted strategy in the streamlined Family Dollar banner,” said Dreiling, it also has been focused on its namesake Dollar Tree banner through “compelling initiatives like our expanded multi-price offerings, significant planned new store openings across the United States, and accretive transactions like our recent successful bid to acquire up to 170 stores from 99 Cents Only,” he added.
Dollar Tree has not set any definitive timetable for a decision and stressed that there’s no assurance this current process will result in any transaction or particular outcome. The retailer has retained J.P. Morgan Securities as its financial advisor and Davis Polk & Wardwell as its legal advisor to assist in the review process.
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