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OAN Staff James Meyers
9:27 AM – Wednesday, March 26, 2025
Dollar Tree announced on Wednesday that it is selling Family Dollar for $1 billion to two private equity firms, a decade after it bought the discount chain for over $8 billion.
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In a statement, Dollar Tree said private equity firms Brigade Capital Management and Macellum Capital Management will purchase Family Dollar, as the discount chain will keep its headquarters in Chesapeake, Virginia.
Despite both Dollar Tree and Family Dollar targeting low-income consumers, Family Dollar locations have struggled to increase production, causing the parent company last year to announce plans to close almost 1,000 locations.
Additionally, Family Dollar has fallen short to compete with other competition such as Walmart and other large retailers. The company has also made recent negative headlines after reports revealed that multiple warehouses were infested with rats.
Dollar Tree has said that many Family Dollar customers were extremely price-conscious, while the chain was also hurt by rising shoplifting incidents, hurting its business as a whole.
“Dollar Tree has struggled for over a decade to make the business work,” said Neil Saunders, an analyst at GlobalData, in an email. “Its efforts have been hampered by supply-chain issues, poor store locations, a proposition that isn’t value-centric enough and a host of other operational problems.”
He added, “Basically, Dollar Tree bit off far more than it could chew.”
Meanwhile, Dollar Tree had been looking for several months for strategic moves for Family Dollar, claiming that the new sale will allow it to focus on its core business.
“This is a major milestone in our multi-year transformation journey to help us fully achieve our potential,” Dollar Tree CEO Mike Creedon said in a statement.
Dollar Tree has had little room for error, during the months prior to the sale. Consumers have had to cut back on spending due to high inflation under the Biden administration as the Trump administration looks to scale back the economy.
Shares of Dollar Tree rose $2.11, or 3.1%, to $69.25 in premarket trading.
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