Family Dollar Stores, Inc. (FDO)’s Takeover By Dollar Tree, Inc. (DLTR): Nelson Peltz Supports Merger; To Gain $368 million From Investment

As the news about the Dollar Tree, Inc. (NASDAQ:DLTR)‘s takeover of Family Dollar Stores, Inc. (NYSE:FDO) have emerged, everybody turned their attention to the biggest winners from this deal. Two of them are Nelson Peltz, the manager of Trian Partners, and Carl Icahn, the manager of Icahn Capital. Peltz and Trian have initiated their position in Family Dollar Stores, Inc. (NYSE:FDO) in July 2010 and have slowly built it to 8.36 million shares or 7.34% of the common stock. Some estimates show earnings of $368 million for Trian and Peltz on their investment in Family Dollar.

TRIAN PARTNERS

In a recent filing with the Securities and Exchange Commission, Trian Partners has disclosed a voting agreement to support the takeover of Family Dollar Stores, Inc. (NYSE:FDO). Trian was pushing for the company to be sold back in 2010, but the attempts were unsuccessful. The fund had also failed to take the company over themselves for $60 per share in 2011. Following this attempt, Trian’s co-founder, Edward Garden, joined the company board and has played a major role in getting Family Dollar Stores, Inc. (NYSE:FDO) to sell itself this time.

“By joining with Dollar Tree, Family Dollar is becoming part of a stronger organization that will drive significant value for shareholders of both companies. Trian is fully supportive of this combination and has entered into voting agreement in support of the merger,” Trian said in a statement.

News of the takeover broke yesterday, July 28th, before the opening bell. Dollar Tree, Inc. (NASDAQ:DLTR) agreed to buy Family Dollar Stores, Inc. (NYSE:FDO) for $8.5 billion in a cash-and-stock deal. This gives Family Dollar shares a deal price of $74.50 apiece, which represents a premium of 23% over the Friday closing price. Family Dollar shareholders will get $59.60 in cash and $14.90 equivalent in Dollar Tree stock for each share.

Icahn has only recently started his “raiding voyage” and is set to gain $188 million. During the past two months, Icahn has built a 9.4% stake in the company, making him the largest outside investor. Other hedge fund managers that are set to win big from this deal are John Paulson, who holds 6.47 million shares, and Natixis Global Asset Management, the manager of Harris Associates with 6.21 million shares.

Disclosure: none.

blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

The 10 Biggest Airports in the World

The 5 Most Gang Infested Cities In America

The 34 Smartest Countries in the World

The 10 Countries with the Highest Suicide Rates

The 10 Most Technologically Advanced Countries in the World

The 10 Safest Countries in the World to Live in Peace

The 10 Top Selling Smartphones in the World 2014

The 12 Biggest Shopping Centers in the World

The 10 Friendliest Countries in the World

Qihoo 360 Technology Co Ltd (QIHU), Actavis plc (ACT), Yahoo! Inc. (YHOO) Among 20 Long Ideas from Sohn Canada

The 10 Laziest Countries in the World

The 10 Most Polluted Countries in the World

The 10 Most Dangerous Cities in America 2014

The Top 10 Gold Producing Countries in the World

The 10 Tallest Buildings in the World

The 10 Richest Stand Up Comedians in the World

The 10 Fattest Countries in the World

The 5 Best Summer Jobs for Teens

The 10 Most Religious Countries in the World Keeping the Faith

The 10 Most Educated Countries in the World

The 10 Most Popular Cell Phones in the World

The 10 Drunkest Countries in the World

The 10 Most Expensive Private Schools in the World

The 10 Smallest Countries in the World

Walking Dead Season 5 Spoilers You’ll Wish You Didn’t Know

The 10 Poorest Countries in the World

The 10 Greenest Countries in the World

The Top 10 Countries with the Highest Population in the World

The 10 Most Visited Countries in the World

The Top 10 Star Wars Characters in the Iconic Series

The 10 Most Expensive Android Phones in the World

5 Reasons Why The Illuminati Is Real and a Threat to Society

The 6 Scariest Halloween Costumes Ever Screamed At

The 4 Biggest Hedge Fund Managers in the World Today

The 15 Most Densely Populated Countries in the World

The 10 Biggest Tea Drinking Countries in the World

Top 6 Ways to Improve Your Checkout Process and Close Sales

The 5 Most Profitable Online Businesses You Can Start Today

The 20 Most Profitable Hospitals in the US

The 5 Most Profitable Home Businesses to Start

The 7 Teams that Will Win the Stanley Cup in 2015

The Top 10 Most Expensive Digital Cameras to Snap Stunning Shots With

The 10 Highest Quality Fast Food Restaurants In America Today

The 8 Best Halloween Decorating Ideas to Spook Up Your House

10 Marvel Women that Should Get a Movie Right Now

The 20 Best Remixes of Popular Songs that Will Make You Forget the Originals

7 Most Expensive Cities in the World

5 Least Expensive Cities in the World

10 Celebrities Who Believe In Scientology

10 High Margin Food Products to Build a Business Around

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!