NEW YORK (AP) — Dollar Tree is buying rival discount store Family Dollar in a cash-and-stock deal valued at about $8.5 billion.
Stockholders of Family Dollar Stores will receive $59.60 in cash and the equivalent of $14.90 in shares of Dollar Tree for each share they own. The companies put the value of the transaction at $74.50 per share.
The boards of both companies have unanimously approved the deal, which is expected to close by early next year.
Dollar Tree stores sell products for $1 or less, while Family Dollar’s pricing is much broader.
Dollar Tree will continue to operate under the existing Dollar Tree, Deals, and Dollar Tree Canada store signs. It will keep the Family Dollar brand as well.
Shares of Family Dollar Stores Inc., based in Charlotte, North Carolina, spiked 20 percent before the opening bell Monday. Shares of Dollar Tree Inc., based in Chesapeake, Virginia, are up almost 4 percent.