A balloon floating above the aisles at a Family Dollar store.
Photograph by Daniel Acker/Bloomberg
The U.S. Food and Drug Administration issued a public warning on Friday regarding potential contamination of several products sold at Family Dollar stores, a grocery chain acquired by
Dollar Tree
in 2015.
The alert came after FDA inspectors found unsanitary conditions, including a rodent infestation, at the company’s distribution facility in West Memphis, Ark., according to a release. The affected products are sold at Family Dollar stores in six states, including Alabama, Arkansas, Louisiana, Mississippi, Missouri, and Tennessee, from Jan. 1, 2021 through the present.
Family Dollar has initiated a voluntary product recall of the contaminated products, ranging from food to cosmetics to drugs and medical devices. Rodent contamination may cause salmonella and infectious diseases, according to the FDA.
Family Dollar says it is not aware of any consumer complaints or reports of illness related to the recall.
A Dollar Tree spokesperson says the company has temporarily closed the affected stores in order to proficiently conduct the voluntary recall.
“We take situations like this very seriously and are committed to providing safe and quality products to our customers,” the spokesperson wrote in an email to Barron’s.
Dollar Tree
(ticker: DLTR) bought Family Dollar in 2015 for almost $9 billion. The parent company just announced the retirement of Executive Chairman Bob Sasser, who has been with the Chesapeake, Va.-based discounter for more than 20 years. Dollar Tree didn’t immediately name a replacement for Sasser.
Activist investor Mantle Ridge has been pushing for a new leadership at Dollar Tree since last November, and Sasser’s departure has stirred up speculation that the retailer may be nearing an agreement with the activist. Investors embraced the news cheerfully.
Dollar Tree shares jumped 5.2% on Friday, to finish at $142.84. Dollar Tree is expected to hold the next shareholder meeting in mid-June.
The discount retailer recently raised its longstanding $1 pricing standard, to $1.25, under the pressure of rising inflation and high transportation costs, which has elicited some angry responses from loyal customers on social media.
Write to Evie Liu at evie.liu@barrons.com
