Private equity, Dollar General Ready to Take Aim at Family Dollar

After billionaire activist investor Carl Icahn revealed a more than 9% holding in Family Dollar Stores, prompting the discount retail chain to adopt a poison pill, a sale of the company may be in the not-too-distant future. With interest likely to stem from both private equity and rival Dollar General, a pricetag could amount to as much as $9 billion. A deal seems more likely given that Nelson Peltz's Trian Fund also has an approximately 8% stake in Family Dollar. That could help support an LBO of the company, similar to how Bill Ackman is helping drive Valeant Pharmaceutical's attempt to buy Allergan.