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Dollar Tree (DLTR), on Wednesday, announced that it had reached a deal with two private equity firms to sell the Family Dollar brand for $1 billion.
Dollar Tree said it will sell Family Dollar to Brigade Capital Management and Macellum Capital Management, with the deal "anticipated to close later in the second quarter," it said. Dollar Tree’s quarterly earnings report, also released on Wednesday morning by Dollar Tree, estimated that the deal would generate net proceeds of just over $800,000,000.
Shares of Dollar Tree were up 5% in recent trading, after rising nearly 10% earlier in Wednesday's session. They were down 47% in the last year when they entered the day.
Dollar Tree acquired Family Dollar for just over $9 billion in 2014. Dollar Tree announced last March plans to close approximately 1,000 underperforming stores. In June it announced that it was reviewing whether it should spin off or sell the Family Dollar Brand.
Discount retailer Family Dollar reported adjusted earnings (EPS) per share of $2.11, on revenue of $5 billion, while same store sales rose by 2%.
Dollar Tree is expecting sales of $18.5 to $19.1 billion in 2025. Same-store sales are expected to grow 3% to 5%, and the adjusted EPS will be $5.00 to $5.50.
UPDATE—This article has been updated with the latest share price information.
