Earlier, it was reported that 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, thus becoming its largest shareholder.
Now the company has 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), according to Reuters.
Late this afternoon, Icahn told Reuters that the poison pill is a "quintessential example" of attorneys "simply earning fees."
He said the poison pill also "puts a damper" on prospects for a "friendly dialogue" with Family Dollar executives.
Shares of Family Dollar Stores are slightly lower in after-hours trading.
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."