Dollar General trims sales view; 'committed' to buying rival
By Nandita Bose and Sruthi Ramakrishnan
(Reuters) - Dollar General Corp reined in its full-year sales forecast on Thursday and said it remained committed to buying Family Dollar Stores Inc, which would solidify its place as the No. 1 U.S. discount retailer.
Dollar General (DG.N: Quote) will lose its top position if it fails to upend a merger agreement between Family Dollar and Dollar Tree Inc DLTR.O.
Dollar stores are facing increasing competition from small-format stores opened by big-box retailers like Wal-Mart Stores Inc (WMT.N: Quote) and online retailers such as Amazon.com Inc (AMZN.O: Quote).
Dollar General took its $80-per-share bid for Family Dollar FDO.N directly to shareholders in September. Family Dollar shareholders are scheduled to vote this month on Dollar Tree's $74.50-per-share offer.
Chairman and Chief Executive Officer Rick Dreiling said the company will give an update on its offer for Family Dollar ahead of the shareholder vote on Dec. 23.
Dollar General narrowed its sales growth forecast for the year ending in January to about 8 percent, for the year ending January, from a range of 8 percent to 9 percent.
The discount chain said same-store sales will increase at or below the previous forecast of 3 percent to 3.5 percent for the year.
Dollar General, which got 75 percent of its third-quarter sales from products priced under $5, is increasing more of its $1 consumable items like food, home cleaning and paper products, he said. Continued...