Dollar General raises bid for rival Family Dollar

Dollar General has 11,000 stores in 40 US states
Dollar General has 11,000 stores in 40 US states

Dollar General, the lead discount retailer in the United States, has raised its bid for rival store Family Dollar to almost $9.1bn (£5.51bn).

Dollar General has also agreed to get rid of 1,500 stores, more than double its last proposition of 700.

Family Dollar had rejected the previous offer of nearly $9bn and said that the number of Dollar General stores could break competition law.

The newest bid from Dollar General is worth $80 a share, up from $78.50.

The Tennessee company has also agreed to pay $500m to Family Dollar if the deal is affected by anti-trust regulations.

Dollar General said last week it remained committed to acquiring Family Dollar, after the target rejected the previous offer, saying the deal could run foul of competition law.

Instead, it opted for a lower bid of $8.5bn from another US discount store, Dollar Tree.

Dollar stores flourished during the US economic downturn, but have since faced competition from chains such as Wal-Mart.