Dollar General (DG) is being acquired by KKR in a $7.3 Billion combined offer after the stock and debt that valued the dollar store at $22.00 per share. This is above the one-year highs on the stock and iw right up within striking distance of the highs from 2003 to 2005. The deal does have to be voted on by holders, but unless another bidder steps up this one should be approved. We covered this one before back in November, and it is surprising why the deal took so long. Perhaps KKR was too busy elsewhere. The board has approved the deal and if shareholders approve the deal it is expected to close in Q3.
This will make the shares in other DOLLAR STORE operators more active as well. Others in the group are as follows:
Family Dollar (FDO) $4.3B market cap; 21.5 P/E; 3.4 Times Book;
Dollar Tree (DLTR) $3.7B market cap; 19.3 P/E; 3.1 Times Book;
99 Cents Only (NDN) $1B market cap; metrics not clear because delinquent in filings.
Jon C. Ogg
March 12, 2007
Jon Ogg can be reached at [email protected]; he does not own securities in the companies he covers.
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