Activist investor Nelson Peltz has upped his stake in Family Dollar and met with management to press his case that the company is undervalued.
Trian Fund Management, Peltz’s hedge fund firm, has taken a 6.6% stake in the discount retailer, according to a regulatory filing.
Peltz, who owns stakes in restaurant franchise company Wendy’s/Arby’s Group and asset manager Legg Mason, told Family Dollar management that the company’s share price could be enhanced through improving its operations, the filing said.
Family Dollar confirmed in a statement that management had met with Peltz.
Unlike higher-end stores, discounter Family Dollar has done reasonably well in the recession as consumers hunt for bargains.
The company said its share price had appreciated 41% so far this year. Its fiscal year third quarter net income was up 19% as of May 29.
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