Dollar Tree has completed its divestiture of 330 Family Dollar stores, which meets the Federal Trade Commission’s stipulation in order to allow the dollar store retailer’s acquisition of Family Dollar.
The spin-off becomes a new dollar store retailer dubbed Dollar Express by new owner, private equity firm Sycamore Partners, which owns and operates several retail enterprises.
The divestiture, which involved Family Dollar stores in 35 states, allows Dollar Tree’s $8.5 billion July purchase Family Dollar to be completed.
Private equity firm Sycamore Partners, which has something of a retail specialty in its portfolio, hasn’t divulged many details about its Dollar Express stores. While the “dollar store” space has emerged as a healthy rival to the likes of Wal-Mart and other discount retailers, there are a variety of approaches.
There are differences even among the now-siblings: Dollar Tree maintains its pricing under a dollar to keep with the price point model, while Family Dollar offers a wider variety of items and prices.
In any case, Sycamore Partners managing director Peter Morrow promised innovation, which could keep Dollar Tree, even with its new Family Dollar stores, and rival Dollar General, which has been growing of late, on their toes.
“We are pleased to have completed this acquisition, which adds to our growing portfolio of leading retailers and consumer brands,” Sycamore Partners managing director Peter Morrow said in a statement. “We look forward to operating these 330 stores as Dollar Express, a brand new, nationwide discount retailer that is well-positioned as an innovator in the market. We believe our significant experience with carve-out transactions will be beneficial in supporting the Dollar Express team to serve our loyal customers and create value.”