NEW YORK (TheStreet) -- Shares of Family Dollar Stores (FDO) are up 14.14% to $69.09 after Carl Icahn (IEP) took a 9.39% stake for $265.8 million in the chain of general merchandise retail discount stores, according to a filing on Friday, becoming its largest shareholder.
Now the company adopted a one-year poison pill with a trigger of 10%. Icahn said he would consider pushing for a merger with Dollar General Corp. (DG), Reuters reports.
Dollar General's shares are up 10.83% to $64.27.
The rights plan is not designed to prevent an offer to acquire the company but to allow its board "adequate time to consider any and all alternatives," Family Dollar said today.
TheStreet Ratings team rates FAMILY DOLLAR STORES as a Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:
"We rate FAMILY DOLLAR STORES (FDO) a BUY. This is driven by multiple strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels and notable return on equity. We feel these strengths outweigh the fact that the company has had sub par growth in net income."