Dollar Tree Purchases Family Dollar for $8.5 Billion

The two rival discount retail stores came to a merger agreement.
4:14 | 07/28/14

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Transcript for Dollar Tree Purchases Family Dollar for $8.5 Billion
Okay. It is Monday July 28 markets are open and our big number today eight and a half billion dollars to discount stores to its big business today. That is how much dollar tree ink is walking over purchase rival Family Dollar Stores a half billion dollar deal approved by the boards of -- those retail chain a lot of money taking place everyone on down -- player in New -- -- that he tales is Yahoo! finance John MacKey Jeff happy Monday morning to -- certain. And the in my for so let me ask you this or one dollar store taking over another break the stock was -- big winner in this. Well the big winner -- the combined companies normally -- -- Family Dollar one because their shares are much higher but you know what. So -- dollar tree so ever -- kind of winds it's all about this mergers and acquisition market and so. The idea between these two emerging is that now all the sudden where you had to kind of weak -- players. -- -- brother players in the country gender specific but to a lesser and lesser rivals in the dollar store industry. Are banding together to fight -- Dollar General and -- growing. Onslaught of wal marts of this size and so really. The consumer wins overall -- got all the sudden now thirteen thousand stores another nineteen billion dollar dollar. Type died chain and I think that this is going to be the sign of things that -- -- terms of what's going on retail right now. Do we ought to get a hit -- individual identities or individual brands or are they going to be all merging into dollar -- Well you know opinions that serious a lot of little bit I'm -- I think that the president that's the kind of fine print that they usually about the Bulger kind of finalized before they have those arguments because I needed egos involved and everyone's going to be. The bickering about it at dollar tree did the buying and I usually indicates that they get to of the naming now there is a little bit of a difference between these stores down. Dollar tree is typically more of a middle class kind of suburban type of operation -- Family Dollar. As head lower and of the socioeconomic target customer and so it's entirely possible that they they leave these. Somewhat independent at least in terms of their branding and then take advantage of these synergies on distribution which is kind of big business speak for its cheaper for them to move their trucks from stores or -- -- -- stores I actually ask -- this is -- and it kind of helped negotiate this entire -- what about Carl -- obviously -- big -- -- And -- have in this merger. The -- the man I don't know about big -- he's a good guy and I know men and it said never underestimate Carly is the toughest 83 year old -- now. And he went in there and he said you know what I'd like this -- to be bought speaking -- Family Dollar. He went on bought 10% of the company largely in stock options. He ends up 180. Million dollars richer this entire process for him began in April. So it's nice work if you can get it now his original idea. Was to -- Family Dollar with Dollar General and so it looked like maybe this was not gonna come together for Carl this time but. As this is want -- figured out and another buyer and -- -- those two companies together. He gets to make out like abandoned -- -- a -- -- different hedge fund bodies Nelson -- John Paulson names familiar with those in the finance community. They also are rake in tens of billions off there's so everyone's just -- -- happy it's a it's a nice day for Carlin he's pretty used to that and stock in both those companies -- you pointed -- seemed to be doing well on both. Yeah and that's that's really why this is such a merger friendly environment because typically. At least according to oil the book of rules that is not really written for trading that we all go -- is that the acquiring company -- their share goes down because they're taken -- financial risk. And they're paying -- and and providing certainty to shareholders of the other company. Both these stocks are going higher that means any -- -- sitting around and CEO bill. And -- and -- and grow and be a big Kahuna alpha dog in my stock will go up anyway. Gosh that seems like a nice way to spend my time and you pick up -- phony caller banker and you start strike and some deals. Interest interest to interest rate -- Iraqi -- -- finally that a good Monday morning to you always appreciate your time and insight. Thank you good to see again of course you can keep up latest headlines right here on -- watching the big number.

This transcript has been automatically generated and may not be 100% accurate.

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