Dollar General Buyout Gets Shareholder OK

by MR Magazine Staff

NEW YORK – Dollar General’s stockholders approved the company’s proposed takeover by the Buck Acquisition affiliate of Kohlberg Kravis Roberts & Co. for about $7.3 billion at a special meeting Thursday.

The deal, which calls for DG shareholders to receive $22 a share in cash and for KKR to assume $380 million in net debt, received affirmative votes from 99% of the shares voted. DG said that votes from about 249.8 million shares, or 79% of those outstanding, were cast. Approval required consent from a majority of shares outstanding.

David Perdue, chairman and chief executive officer of Dollar General, said he would resign upon completion of the merger, expected on or about 6 July. David Beré, current president and chief operating officer of the Goodlettsville, Tennessee-based general merchandise retailer, will become interim CEO while a search for a successor to Perdue is conducted.

“Our shareholders have expressed their overwhelming support of this merger with their votes today,” said Perdue. “This event marks a major milestone in the long and successful history of Dollar General. I believe that the merger is the right next step for Dollar General and I have confidence that KKR is committed to investing for the future competitiveness and growth of this great company.”

When the agreement with KKR was first reached in March, the $22-a-share price represented a 29% premium to the company’s stock price on the New York Stock Exchange over the previous 30 trading days.

In the fiscal year ended Feb. 2, DG registered sales of $9.17 billion on a 3.3% same-store sales increase. The agreement with KKR came just after the company had laid out a plan to revitalize its stores and update its inventory.

Dollar General operated 8,205 “neighborhood” general merchandise stores as of June 1.