April 6, 2019 / 12:38 AM / 7 months ago

UPDATE 1-Starboard drops Dollar Tree board challenge

(Adds Dollar Tree’s response)

April 5 (Reuters) - Activist investor Starboard Value LP said on Friday it was withdrawing its nominations for directors at Dollar Tree Inc’s board, saying that it was pleased with the company’s decision to test multiple price points at its stores.

Starboard in January pushed for changes at the discount chain, seeking to capitalize on criticism from some investors and analysts that Dollar Tree should consider raising prices for some products to more than $1.

The hedge fund, along with its director nominations, had urged Dollar Tree to explore all alternatives for its Family Dollar business, including a sale.

The company last month announced plans to close hundreds more Family Dollar stores, and also reported better-than-expected fourth-quarter, same-store sales.

“We continue to enjoy constructive conversations with management and recognize their progress, as well as the significant increase in shareholder value based on the promises made since our involvement,” Starboard said.

Dollar Tree acknowledged Starboard’s decision in a statement and said it was committed to its plan to improve Family Dollar’s performance. (Reporting by Manas Mishra in Bengaluru; editing by G Crosse and Sandra Maler)

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