WASHINGTON (dpa-AFX) - Discount retail chain Dollar Tree, Inc. is exploring
the sale of its unit Family Dollar Stores LLC, the Wall Street Journal reported
citing people familiar with the matter.

Following the news, Dollar Tree shares were gaining around 3 percent in
pre-market activity on the Nasdaq, to trade at $123.73.

The company is working with financial advisers to conduct a strategic review of
its Family Dollar business to explore options including a potential sale or
spinoff. It is likely to announce the plans related to Family Dollar when it
reports first-quarter results later in the day.

As per the report, the Chesapeake, Virginia -based company has tapped bankers at
JPMorgan for the strategic review.

In mid March, Dollar Tree had announced its plans to close around 970
underperforming Family Dollar stores, in which around 600 in the first half, as
part of its comprehensive store portfolio optimization review. The remaining
Family Dollar stores as well as around 30 Dollar Tree stores were to close over
the next several years, at the end of each store's current lease term.

Dollar Tree's comprehensive store portfolio optimization review involved
identifying stores for closure, relocation, or re-bannering.

According to Rick Dreiling, Chairman and Chief Executive Officer, the decisive
steps were expected to strengthen the Family Dollar brand and better position it
to achieve its full potential.

Dollar Tree then had added that it was placing a greater emphasis on opening
more Dollar Trees than historically done in the past due to the returns and
performance, and the vast majority of new store openings in fiscal 2024 will be
Dollar Trees.

While reporting a hefty net loss in its fourth quarter compared to a last year
profit, despite revenue growth, the company said the store closure decision was
taken based on an evaluation of then market conditions and individual store
performance, among other factors.

In late February, Family Dollar was fined $41.675 million by the U.S. Department
of Justice after pleading guilty to holding consumer products including food and
drugs in rodent-infested warehouse in West Memphis, Arkansas. It was the
largest-ever monetary criminal penalty in a food safety case, the DOJ then
noted.

Family Dollar in February 2022 had recalled all drugs, medical devices,
cosmetics, and human and animal food products sold since January 1, 2021 in the
404 stores that had been serviced by the warehouse.

As of February 3, Dollar Tree operated 16,774 stores under the brands of Dollar
Tree, Family Dollar, and Dollar Tree Canada.



Copyright(c) 2024 RTTNews.com. All Rights Reserved

Copyright RTT News/dpa-AFX