Family Dollar Gets Peltz Bid To Take It Private

PORTLAND, Ore. (AP) - Discount retailer Family Dollar Stores Inc. on Tuesday received a bid from activist investor Nelson Peltz's firm to take the company private in a deal worth up to $7 billion.

The Trian Fund is offering $55 to $60 per share for Family Dollar, according to a filing with the Securities and Exchange Commission.

Shares of Family Dollar soared 25 percent, or $11.19, to $55.15 in extended trading Tuesday after the filing was made.

Trian owns large stakes in a variety of major American businesses including upscale jeweler Tiffany's & Co., food company H.J. Heinz Co. and fast-food chain Wendy's/Arby's Group Inc.

It is already Family Dollar's largest shareholder with about 8 percent of its shares. Paying $60 each for the Family Dollar shares it does not already own would cost Trian about $6.99 billion.

Family Dollar, a discount retailer based in Matthews, N.C., confirmed late Tuesday that it received the offer. It said its board will review the proposal with its financial and legal advisors, Morgan Stanley and Cleary Gottlieb Steen & Hamilton LLP.

The company has more than 6,800 stores in 44 states and is one of the standout retailers in the post-recession economy. It benefited during the downturn from shoppers heading to its stores for bargains on everything from food to clothing.

Family Dollar's net income rose 23 percent to $358.1 million, or $2.62 per share, on revenue of $7.87 billion in its latest fiscal year.

Last summer, Peltz disclosed that he was buying up shares of Family Dollar, saying the stock was undervalued. He said he met with senior management to discuss the company's direction and attempts to boost shareholder value

The Trian Fund bought up more Family Dollar shares in January.