As inflation moderates, Dollar Tree announced plans to divest its Family Dollar segment to Brigade Capital Management and Macellum Capital Management. The $1 billion deal is expected to close during the second quarter of 2025, subject to standard closing conditions and regulatory approvals.
“Since 1959, Family Dollar has served its customers by offering convenient, high-quality products at a great value and the business is a pillar in communities across the United States,” according to the deal’s press release. “We look forward to continuing and enhancing Family Dollar as its own enterprise, which we are confident will drive greater success for the business and value for all of Family Dollars stakeholders, including employees, customers, and communities.”
Net Sales of Family Dollar 2017 – 2023
Source: Statista
Family Dollar was founded by Leon Levine in Charlotte, NC with the goal of offering customers merchandise for under $2. The company expanded rapidly and went public in 1970, fueling additional expansion. By the time the company celebrated its 50th anniversary in 2009, it had emerged as a Fortune 500 company with $5 billion in sales across its 5,000 stores. Dollar Tree acquired Family Dollar in 2015 with a combined footprint of 15,000 stores. While Dollar Tree had held to its $1 price for products over 36 years, inflationary pressures forced the company to raise prices to $1.25 in 2022.
U.S. Inflation Rate, 2021 – 2025
Source: Statista
Inflation began to spike in 2021, as the U.S. economy boomed alongside the loose monetary policy that followed the Covid-19 pandemic. Inflation remained historically high over the following years, until the Federal Reserve hiked interest rates at an unprecedented speed. These hikes shook the U.S. banking system but were eventually successful in curtailing inflation’s rate of increase. But inflation had left its mark, with the years of rising prices had a cumulative effect of making goods well over 20% more expensive than they had been in 2020.
In March 2025, inflation’s rate of increase slowed to 2.4%, which was lower than analysts’ prediction of 2.6% and represents the lowest rate of increase in 6 months. This increase remains above the Federal Reserve’s long run goal of 2%. This continues to place upward pressure on prices for Dollar Tree and Family Dollar.
According to DealPulse’s M&A database, which harnesses both AI and attorneys to digest the granular deal points of each publicly-announced transaction over $25 million, Dollar Tree is advised by law firm Davis Polk & Wardwell LLP. Acquirers Brigade Capital Management, LP and Macellum Capital Management, LLC are advised by Paul, Weiss, Rifkind, Wharton & Garrison LLP.
