S&P keeps Family Dollar Stores on watch

Standard & Poor’s said its BBB- corporate credit and issue-level ratings on Family Dollar Stores Inc. remain on CreditWatch with negative implications, where S&P placed them on July 28, 2014.

Monday’s update follows shareholder approval of the proposed merger with Dollar Tree Inc. and accompanying announced financing to fund the deal.

“The ratings on Family Dollar reflect the pending merger with Dollar Tree Inc., following a drawn out bidding war with Dollar General Corp. (BBB-/watch negative/--) for the company given recent underperformance and increased competition in the saturated discount sector,” said S&P credit analyst Diya Iyer in a news release.

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