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PROPOSED ACQUISITON (Notes)
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9 Months Ended |
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Nov. 01, 2014
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| Business Combinations [Abstract] | |
| PROPOSED ACQUISITION |
PROPOSED ACQUISITION
On July 27, 2014, the Company executed an Agreement and Plan of Merger to acquire Family Dollar in a cash and stock transaction ("Merger"). Under the Merger, which has been unanimously approved by the Boards of Directors of both companies, the Family Dollar shareholders will receive $59.60 in cash plus no more than 0.3036 and no less than 0.2484 shares of the Company's common stock for each share of Family Dollar common stock they own. The transaction is subject to Family Dollar shareholder approval, expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act and other customary closing conditions. The Family Dollar shareholder meeting to approve the merger is currently scheduled for December 23, 2014.
The Company intends to finance the acquisition through a combination of cash on hand, bank debt and bonds. In connection with the transaction, the Company has received a financing commitment from JPMorgan Chase Bank, N.A., Wells Fargo Bank, National Association, Bank of America, N.A., Royal Bank of Canada and U.S. Bank, National Association and others, with the bank debt syndication and bond offering expected to occur prior to closing.
On or before closing, the company is expected to incur approximately $175.0 million in merger related expenses, of which $15.2 million and $22.7 million, respectively, was incurred in the 13 and 39 weeks ended November 1, 2014. During the 13 weeks ended November 1, 2014, $14.3 million was recorded in "Selling, general and administrative expenses" and $0.9 million was recorded in "Interest expense, net." The Company also expects to expend approximately $165.0 million in capitalizable costs related to the proposed merger financing. Of this amount, $60.8 million of deferred financing costs was recorded at November 1, 2014 in "Other assets, net." At November 1, 2014, $60.1 million of merger related expenses and capitalizable costs have been accrued in "Other current liabilities."
For additional discussion of the proposed merger, please see the "Proposed Merger" section included in "Part I. Financial Information, Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations." of this Form 10-Q.
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