Dollar General (DG) May Need to Offer More Concessions to Seal Family Dollar (FDO) Deal

Dollar General (NYSE: DG) might have to offer even more if it plans to complete an acquisition of Family Dollar (NYSE: FDO).

Reuters noted that Dollar General's offer -- which values Family Dollar at around $9.1 billion -- is richer than Dollar Tree's (Nasdaq: DLTR) $8.5 billion bid, but the break-up fee and offer to sell more stores still may not be enough to offset regulatory risk in the potential deal.

Family Dollar still hasn't completed review of the deal and a final decision hasn't been made.

Dollar General said, with it's recently bid, that we are confident that our enhanced proposal sufficiently addressed any concerns that led Family Dollar's Board of Directors to reject our prior proposal without any discussions between our companies.

One key item off the table is investor pressure; earlier in the week it was revealed that activist investor Carl Icahn sold out his Family Dollar stake, netting $200 million of profits in the process.

Shares of Family Dollar are flat in early trading Friday.

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