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US: Family Dollar adopts poison pill as Dollar General buyout looms

By  |  June 9, 2014

Budget-friendly retail giant Family Dollar has reportedly adopted a so-called poison pill to protect itself against hostile takeovers as activist investor Carl Icahn considers pushing for a merger with rival Dollar General.

Reports say Family Dollar adopted the plan, which allows the company to dilute shares of investors if they exceed a certain threshold of ownership. The plan was implemented as Icahn, who announced a 9.39 percent ownership in Family Dollar late last week, considers pushing for a merger with top rival Dollar General.

But the “poison pill” only “puts a damper” on what could be a friendly merger dialogue between the two retailers, Icahn said Monday, adding that the company was already planning such a discussion.

According to reports, analysts suggest Dollar General could seek to acquire its competitor as it struggles to compete against Wal-Mart, Target and other low-income retail destinations.

Full content: Reuters

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